The latest Scottish new business statistics published by the Committee of Scottish Bankers (CSCB) today continues to show little sign of a pick up in new businesses in Scotland. I have graphed the latest data in the following chart:
Despite the recovery, the number of new businesses continues to fall. This should clearly give us food for thought. However, as I noted here, the CSCB data appear to conflict with the VAT registrations data, which are a trqditional proxy for new firms. Unfortunately, the VAT data are available only on an annual basis to 2012. A comparison of the two series is shown in the next chart:
The VAT data show a slight upward trend since the trough of the recession in 2009, whereas the CSCB shows a downward trend. In addition the VAT data show the a trend rise in the Scottish share of UK VAT registrations since 2004 which peaked in 2010 at 6.60% but has fallen since to 6.45% in 2012. The historic problem with the business birthrate in Scotland is still evident since we are still adrift of a population share of 8.3%.
And the CSCB data?
Maybe the data are too partial since they cover new business opening accounts with the main banks. Perhaps Scottish new firms are increasingly using using other banks and sources of finance: hence the continuing downward trend in the data despite recovery.