A new Bank of Scotland (BoS) report has highlighted rising confidence in the North Sea oil and gas industry – and slowing job cuts.
It is the second such morale booster for the industry this month, following similar study findings from Aberdeen and Grampian Chamber of Commerce.
Stuart White, regional director, mid market, north of Scotland, BoS, said yesterday the bank’s sixth annual survey of the sector had revealed a “shift in sentiment”
But he warned: “We are not out of the woods yet. I would say it is a mood of cautious optimism.
“There are still choppy waters to navigate, with political uncertainty at home and abroad, but we remain confident in the sector.”
The BoS Oil and Gas report says a majority of firms surveyed across the industry said they were no longer planning to cut jobs to control costs and many were more optimistic about recruiting in the coming year.
And it hails the billion-barrel oil find in the Greater Lancaster Area, west of Shetland, as “cause for great excitement”.
“This time last year, the UK’s oil and gas sector was still reeling from an exceptionally challenging period and many firms were still acting to counter the impact of an extended spell of depressed oil prices,” the report says.
It adds: “This year’s survey of decision makers from more than 100 oil and gas businesses from Scotland, England and Wales, ranging from producers to firms in the supply chain, found a sector more positive than it has been in recent years.
“There is evidence that the tide looks like it is starting to turn on employment in the North Sea and firms are planning for growth.”
The percentage of firms anticipating job cuts within the next year is down from nearly one-third (32%) in 2016 to fewer than one-fifth (19%) this time.
Nearly one-fifth (19%) of firms said they had seen a net increase in staff numbers, hiring in some areas and making redundancies in others. A quarter (25%) had made no changes to their headcount.
Despite continued low oil prices, growth was on the agenda for more than half (58%) of companies.
Firms anticipating growth said they expected, on average, turnover to increase by 26% within the next year. This is up from the 49% of firms who expected an average of 17% growth in the 2016 survey.
Looking ahead to the next 12 months, firms said they were looking to grow organically (27%), by diversifying operations (22%) and through mergers and acquisitions (9%).
Recommended for you
