The Bank of Scotland’s chief economist has called on business leaders to invest in their firms to help support a continuing upturn in the country’s economy.
Professor Donald MacRae said he expected a recent lift in fortunes to continue over the coming months but stressed the recovery would be enhanced by bosses turning their confidence into new commitments to growth.
He was speaking as the latest edition of the bank’s Business Monitor survey showed the Scottish economy continues to perform at pre-recession levels, with more growth on the cards in the weeks and months ahead.
The monthly study revealed expectations for the remainder of the year are still high, with figures comparable to those last seen prior to the banking crash in 2007.
It also found “welcome news” for export firms, with a recovery in exporting still in evidence.
“The surge in economic activity identified in summer 2013 has been maintained into summer and autumn this year,” Professor MacRae said.
“Expectations have fallen slightly but are at pre-recession levels, suggesting the recovery will continue throughout 2014 and into 2015.
“Further increases in investment by firms would enhance the recovery.”
A balance of 30% of the firms surveyed reported an increase in turnover during the three months to the end of August, marking what the Bank of Scotland called the report’s “best result in over seven years”.
Manufacturers and service outfits matched the wider picture, with fewer than one-in-five firms recording a reduction in sales over the period.
Meanwhile, expectations for turnover in the coming six months showed a positive balance of +21% a slide on the previous three-month reading of +36% but up on the same period last year.
Companies’ assessment of their immediate prospects has been on the up through last year and the first two quarters of this year.
Though that confidence dipped in the latest period it remains ahead of the high levels of the second half of last year.
The result also marked seven consecutive results with positive expectations for turnover the most optimistic sequence of results since 2007.
While 51% anticipate sales to be static in the next six months, 35% expect revenues to increase and 14% believe it will fall.
Service firms are more optimistic than production firms, showing an overall net balance for rising turnover for the next six months at +26% compared to +14% for production firms.
The bank said the strong expectation levels suggest “vigorous growth” in Scotland’s private sector during the autumn this year.
Finance Secretary John Swinney hailed the figures, describing them as “testament to the underlying strength of the economy”.
“With expectations for business remaining positive, there are grounds for continued optimism as we move towards the end of what has been a hugely positive year for Scotland’s economic performance,” he added.