Unemployment in Scotland has fallen by 25,000 to an eight-year low with the jobless rate north of the border now below the UK as a whole, official figures today revealed.
But there are concerns that many people are "dropping out" of the labour market, "inactivity" levels up by 32,000. The figures also show that the number of Scots with a job has fallen by 8,000.
Unemployment in Scotland now stands at 127,000, according to Office for National Statistics (ONS). The jobless rate is 4.6%, which is below the rate of 4.9% for the whole of the UK.
The fall of those in work, though, meant the employment rate fell to 74%, below the UK average of 74.5%.
Scottish Secretary David Mundell, said: "I am pleased to see unemployment falling again in Scotland, and it is now at its lowest level since 2008. But it is worrying that employment is down and more people are dropping out of the labour market in Scotland when the rest of the UK is seeing employment up.
“The levers to shape the Scottish economy are there for the Scottish government to pull. They need to start focusing on the day job and how they can use their new powers to support the Scottish economy.
“Because these are not just statistics – behind the fall in employment and rise in economic inactivity are thousands of people in Scotland who deserve the security and opportunity that a job brings.”
A separate measure of economic activity also showed this fell by 32,000 over the quarter and now stands at 2.74 million. The economic activity rate decreased over the year to stand at 77.7%.
Scotland also continues to outperform the UK on female employment, unemployment and inactivity rates. Youth unemployment has also fallen 5 % over the year to 12.2%.
The Scottish Government's employability and training minister Jamie Hepburn said: "Despite continuing economic concerns following the EU referendum result, these latest statistics show our policies and investment are helping to reduce unemployment.
"We will not be complacent and are absolutely committed to taking action to tackle inequalities and increase employment rates."
Liz Cameron, Chief Executive of Scottish Chambers of Commerce show a "mixed picture" for the Scottish economy.
"The large fall in unemployment is good news but overall levels of employment in Scotland have fallen, economic inactivity is rising, as has the number of those claiming benefits," she said.
“Against a background of Scottish economic growth which has lagged below overall UK growth levels since April 2015, it is clear that challenges remain to be addressed, including the need to grow Scotland’s productivity, which remains low by international standards.