ECONOMIC growth in Scotland is likely to remain sluggish as the services and manufacturing sectors continue to lag behind the rest of the UK, according to research from British Chambers of Commerce (BCC).

The quarterly survey raised hopes the UK may avoid a triple dip recession thanks to growing levels of exports from the services sector, while domestic orders in manufacturing are also improving.

However, in Scotland the picture is far less buoyant, with several key indicators for the services sector remaining stuck in negative territory.

The survey subtracts the proportion of firms reporting a rise from those experiencing a fall, while also adjusting findings to give larger companies a greater weighting.

In Scotland, 140 businesses were involved in the research, with more than 7000 responding across the UK.

The latest findings, for the first quarter of this year, show services firms in Scotland have a -12% balance of increasing turnover and -21% of growing profit, compared to respective UK-wide figures of 40% and 22% respectively.

The Scottish sector has seen a slight improvement in domestic sales and orders but both remain stuck in negative territory, signalling contraction in the sector.

Perhaps as a result of those conditions, employment intentions for the next three months worsened to a net weighted balance of -21% and widened to -19% for the quarter just finished.

Although the research does not provide a reason for the services sector weakness in Scotland, it has been suggested previously consumers are more cautious due to the greater reliance on a public sector workforce which has been affected by the Coalition Government's austerity measures.

In manufacturing, confidence in growing turnover was at 23% in Scotland against 44% for the UK.

For profits the Scottish figure was 4%, which trailed the 33% expectation at a UK level.

Although prospects in manufacturing appear brighter – signalled by a more than trebling of employment intentions from 5% to 17% – the Scottish sector is behind the UK in both domestic and export sales and orders.

Liz Cameron, chief executive of Scottish Chambers of Commerce, said: "The results from Scotland were mixed this quarter. Overall, the key performance indicators improved for the service sector but they are still in negative territory.

"The key indicators fell slightly for manufacturers but at least they are positive, indicating growth in the sector.

"The most encouraging results were the increase in confidence for both sectors about their longer-term future.

"Despite the sharp falls in Scottish unemployment over the winter months, our expectations are that growth will remain sluggish over the remainder of this year.

"Government action at Scottish and UK levels to reduce business costs is a priority, particularly in terms of business rates."

The research found improving business confidence across the UK alongside stronger investment intentions.

The BCC said the results suggested the economy grew between January and March this year.

David Kern, BCC chief economist, said: "Fears of another recession are calmed by our results. Our survey results show areas of growing strength in the UK economy that militate against unnecessary pessimism, even though the UK's growth rate is still falling short of its potential."