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Scottish Construction Industry Optimism at a Ten-Year High

The latest Chamber of Commerce Survey has revealed that Scotland’s construction industry is more confident than it’s been in ten years.

The quarterly report, which covers last April to June, showed that a pattern of stronger orders for commercial clients, although house-building and the public sector showed less progress.

When asked, 43% of construction businesses said that they were optimistic about the future. Only 15% admitted to a more negative outlook.

This improved outlook comes on the heels of ongoing and deep employment losses between 2008 and 2012.

Research put together by Fraser of Allander Institute at Strathclyde University indicates that construction jobs have increased in number for six consecutive quarters.

Building companies stated that they are presently operating at approximately 85% capacity.

Building companies reported they are operating at around 85% of capacity.

Manufacturing outlook was also stronger in terms of confidence, with more businesses reporting growth compared to those seeing losses.

Nearly 70% of companies either maintained or increased their revenue in the export sales sector last spring, and additional growth is strongly anticipated during the present quarter.

Over 40% of manufacturing companies were positive about their future prospects, while only 14% were negative about their outlook. Where exports were concerned, there was a balance on 41% to 5%.

Around half of the firms were planning to invest, but concerns were raised about a shortage of labour with the required skills.

The survey demonstrated that companies that supplied the oil and gas industry were pessimistic about their prospects in the wake of the ongoing lower price in Brent crude oil.

Scottish Chambers of Commerce researchers were informed that in the bigger financial and business services sector, confidence levels were trending downward. The results are indicative of cash flow and profitability being down.

Wholesale and retail experienced a more positive balance among category businesses, after downward results were reported in 2014.

59% of businesses in the tourism industry reported increasing revenue while 16% complained of decreases. Confidence exceeded pessimism 42% to 13%.

Structural Defects Insurance

Liz Cameron, chief executive of the Scottish Chambers of Commerce stated that the second quarter of 2015 points to more positive business trends in the Scottish economy. She said there was a recognisable, albeit slow, pattern of sustainable growth.

The primary exception to the pattern of growth was in the oil and gas service sector, where both the outlook and actual performance of companies was appreciably lower than the levels experienced in other service sector firms. Ms Cameron said that this was the case for businesses not just in Scotland’s north east but across the country, where oil and gas is a major business focal point.

With regards to construction, she said that the government needs to determine where bigger-scale public sector construction work will be appearing after the Edinburgh-Glasgow rail electrification, Queensferry Crossing, and other current projects have been finished.

Ms Cameron confirmed that the manufacturing sector appears more positive in the year’s second quarter, with both sales and orders showing strong activity levels.

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