Scotland business

Scottish private sector output 'contracts'

chefs in kitchen Image copyright Thinkstock
Image caption The report indicated that the services sector was affected in particular by reduced demand

Scottish private sector output has contracted for the first time since August, according to a regular survey of purchasing managers.

The Bank of Scotland PMI found business activity weakened in November, with a slight decline in new order intakes.

Survey data also pointed to the first reduction in workforce numbers since June, although the rate of job cutting was "only slight".

The report said that reduced demand hit the services sector in particular.

Service providers recorded a moderate decline in business activity during the month, while production growth was registered in Scotland's manufacturing sector.

Firms also reported a further sharp increase in input prices.

According to PMI panel members, fuel price increases, higher wages and unfavourable exchange rates were some of the factors behind rising average cost burdens.

Companies raised their output charges for the fourth month in a row but the increase was moderate.

Nick Laird, from Bank of Scotland Commercial Banking, said: "With job cuts evident for the first time since June and input costs such as fuel prices, higher wages and foreign exchange rates increasing, companies will be looking for a pick-up in new business in the new year to help rejuvenate the sector."

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