A vast majority of north-east firms are either already suffering a negative impact from lower oil prices or expect it soon, a survey has revealed.
Companies across the region were canvassed for the Aberdeen and Grampian Chamber of Commerce (AGCC) North East Business Week (NEBW) study, and the scale of fallout from the oil and gas industry downturn is among the findings.
AGCC’s research unit carried out the research on behalf of the chamber and its NEBW partners – Elevator, the Federation of Small Businesses and the Scottish Council for Development and Industry.
The survey report, officially unveiled today, says the 91% of businesses feeling the impact of lower crude prices is much higher than normal for troughs in the cycle, which usually had a negative impact on 69% of firms.
More than two-fifths (42%) of companies said they were having to cut their own prices for goods and services, with 59% of energy sector firms reporting the same.
Across the spectrum, 36% of businesses have lost contracts and 14% made people redundant as a result of the oil crash.
Of the energy industry firms surveyed, 40% have lost work and 29% cut jobs as they readjust to the new trading environment.
Employment across the region is now predicted to fall by 8% over the next two years, compared with expectations of 15% growth in a similar survey
Among other findings, redevelopment in and around Aberdeen International Airport, faster broadband and the new city bypass road were identified as the top three “change projects” likely to boost the north-east economy.
Major constraints to growth included late payment, skills shortages, the cost of doing business and financing costs.
If business leaders could change one thing about politics, 18% expressed a preference for better collaboration and consensus between political parties, governments and councils.
The fifth annual NEBW draws to a close today after a week of events focused on topics such as how to deliver a pitch and links between business and schools as well as changes in the oil and gas industry.
A mix of free events, dinners, and seminars were held with associate partners including Robert Gordon University, Aberdeen University, Skills Development Scotland and the Oil and Gas Academy of Scotland.