The survey sampled over 500 firms in October from across the Scottish economy.
The results come at a time of high uncertainty for businesses operating in the Scottish and UK economies with rising COVID-19 cases and further lockdown restrictions, in the form of a tiered system, being announced by both Governments in October.
Our survey results show that business activity remains low compared to normal levels.
Whilst many businesses have seen levels of activity increase over the latest quarter, the current economic uncertainty remains the biggest concern over the coming months.
Tourism-facing industries remain the hardest hit in the Scottish economy and are the most exposed to tightening COVID-19 measures. Businesses in these industries are expected to make job cuts before the new year.
With the tightening of restrictions across different regions of the UK it remains to be seen how businesses will manage under the new tiered system and how employment will fare even with the extension to the Government furlough scheme.
Authors
The Fraser of Allander Institute (FAI) is a leading economy research institute based in the Department of Economics at the University of Strathclyde, Glasgow.