Leader: Boost business to help new jobs

The economic rationale for higher public spending in Scotland was that this would shield more of the working population from the vagaries of the business cycle. But this is now demonstrably not the case.

While Scotland's claimant count level fell in June by 600 to a rate of 4.8 per cent, the figure for the UK is lower, at 4.5 per cent. On the broader International Labour Organisation measure, unemployment rose by 8,000 in the three months to May, to 216,000, or 8.1 per cent. For the UK overall, the ILO unemployment count fell by 34,000 to 2.47 million or 7.8 per cent. And Scotland's employment rate, which had been consistently higher than that for the UK, has dropped to 72.1 per cent, with the UK figure at 72.3 per cent.

Arguably more worrying is that Scotland will be hit harder as cuts in government spending begin to bite, suggesting a continuing rise in unemployment here for the foreseeable future. This will be a difficult and painful time for many, but unavoidable if we were to bring down unsustainably high debt levels and debt interest charges. The Scottish Government is right to prioritise action to nurture the economy and protect recovery. But it must pull out all the stops to encourage job-creating business expansion and new investment.