Rutherford Cross, specialist finance search and selection firm, hosted an exclusive roundtable lunch with the Bank of England.
The event brought together a group of Finance Directors and Chief Financial Officers from across the Scottish business community for an insightful discussion on the current economic landscape.
Below is a summary of the key reflections and takeaways from this thought-provoking session:
- There is a general slowing in the global economy around 2% annually and on a downward trend. These global headwinds could be creating levels of uncertainty and companies pulling back on investment and decision making
- Global GDP growth under 1.5% in 2025. Global GDP growth is projected to remain below historical norms, but underlying GDP growth is expected to pick up slightly
- High levels of global and domestic headwinds have fed into consumer spending meaning peoples savings are still at a high level with household savings ratio rising to 10%
- UK unemployment has recently risen to 4.8% and Scotland’s to 3.9% in August. Underlying employment growth is judged to have softened with employment intentions reducing and businesses being more considered on their hiring plans. Projection is for unemployment levels to stay at similar levels going forwards
- Labour market feels less tight. The vacancy:unemployment ratio sits at around 0.4 currently, a loosening / easing of the job market
- Wage growth has declined across various measures and is expected to fall to around 3¾% by the end of the year
- CPI inflation rose to 3.6% in June. Expectation was for CPI inflation to increase from August’s 3.8% to 4% in the September data but surprisingly has remained at 3.8% as announced on October 22nd. Expectations are this will drift down through 2026 to get to 2% in 2027 and 2028
- Interest rates have been cut for a fifth time since last summer to 4% and further cuts are to be expected on a gradual and cautious basis
An overall roundup of the discussion was that uncertainty is the underlying theme with businesses experiencing high-cost pressures and a looming budget coming at the end of November. Even for businesses who feel they are doing well it is still felt that getting bottom line profitability is tough right now as is retaining cash. The discussion covered productivity being a key driver for the economy and how UK productivity has been at lower levels than other countries for a number of years. There could be a variety of reasons for this and a clear driver is relatively hard to pin down, however some views are a continuous lack of investment from businesses in areas like management training as well as ability to adapt to technology changes, there can be a long lead time with any changes in Technology before these materialise. Positively, there was discussion around the recent announcement from the Scottish Government that Scotland could receive billions of pounds in tech investment after the launch of an AI Growth Zone. Several potential locations for the AI Growth Zone, expected to expedite the deployment of crucial infrastructure such as data centres, have already been pinpointed in Scotland (as reported in Business Insider in July this year).
While there is no doubt that there is still a lot of challenge and uncertainty out there, at Rutherford Cross we have been encouraged to see a number of businesses still investing for the future with finance leaders who can drive forward performance and growth and are able to navigate the rapid level of change with AI and foster a culture of continuous improvement.
Reflecting on how we have seen the market in 2025 so far, interestingly we have seen an increase in senior level roles both interim and permanent at Finance Director and CFO level. In a relatively flat economy where businesses have had to handle rising costs and prolonged periods of uncertainty, we are seeing businesses investing in more senior and strategic level roles with strong commercial focus and data management and interpretation scoring high on the skills requirement. Our permanent senior level appointments have encouragingly come from a number of newly created roles and across PLC, Private Equity and Owner Managed Scale Ups.
Our interim area has seen 50% of these senior level roles created either from resignation or internal promotion with companies often looking to access the immediately available talent pool in order to limit any gap in what is always a critical role. The remaining interim FD / CFO vacancies have come from either company growth or maternity. Scotland has a large number of high growth potential companies and we have seen a rise in the number of Fractional CFO hires (can range from 2 days per week to 2 days per month) with small companies catching onto the significant benefits of hiring a highly skilled Fractional CFO which can range from invaluable cash flow advice and management, commercial acumen and expertise, relationships with banks and private equity, as well as bringing with them a valuable wider professional network.
In times where you cannot rely on your business being carried by an upwards economy it is showing us that having a highly skilled and strategic Finance Director is essential to drive forward future growth.
Please contact Hazel Wynn at Rutherford Cross if you are interested in attending future events: [email protected]
