Alex Salmond under fire as 25,000 more Scots out of work

ALEX Salmond’s handling of the economic crisis has been criticised, after figures showed Scotland’s unemployment had soared to 229,000, with the proportion of people out of work now higher than in the UK as a whole.

The unemployment rate in Scotland rose dramatically, from 7.5 per cent to 8.5 per cent in three months, and is now greater than the 8.3 per cent rate recorded for the UK.

In the past, the First Minister has defended his economic policy on the grounds that Scotland has been the only nation in Great Britain where unemployment has been falling and that the jobless rate was lower than elsewhere.

The revelation that the Scottish unemployment rate had gone beyond the UK figure for the first time since the first quarter of this year saw opposition parties attack Mr Salmond for “complacency”.

The Office for National Statistics revealed unemployment had risen by 25,000, from 204,000 in the May-July period to 229,000 recorded between August and October.

Almost half of those out of work were young people, with youth joblessness showing a dramatic rise. The unemployment level for 16-24 year-olds rose 27 per cent, from 89,000 in May-July to 113,000 – an increase of almost 2,000 a week.

The latest unemployment rate for 18-24 year-olds was 23.5 per cent in Scotland, three percentage points higher than the UK rate of 20.5 per cent and up from 19.4 per cent in May-July.

Across the UK, unemployment reached 2.64 million, the highest level since 1994 and a rise of 128,000 in the three months to October. UK youth unemployment rose to 1.027 million, the highest since records began in 1992, beating the record set only last month.

Mr Salmond’s response to the dismal figures was to demand an urgent UK-wide jobs summit, with finance secretary John Swinney meeting UK ministers including Chancellor George Osborne and Chief Secretary to the Treasury Danny Alexander.

The First Minister claimed the UK government’s economic policy was “in a state of collapse”, adding: “The Prime Minister’s policy of isolation in Europe can only make things worse.”

The SNP leader said the Office of Budget Responsibility had already warned the UK economy was shrinking in the final quarter of this year. “That is why the Scottish Government is calling for an urgent jobs summit, comprised of the four finance ministers of the Westminster government and the devolved administrations, to agree a programme of immediate employment creation, a Plan MacB, with a focus on increased infrastructure investment,” he said.

But Mr Salmond’s remarks met with cynicism from his political opponents. They claimed the deteriorating unemployment rate in relation to the UK made a mockery of Mr Salmond’s previous assertions that the Scottish situation was relatively healthy.

In September, the First Minister said Scotland was the only place “in these islands” where unemployment was falling, arguing his “Plan MacB has a great deal to recommend it”.

The following month, Mr Salmond said Scotland had “lower unemployment, higher employment and lower economic inactivity than the rest of the United Kingdom”. Again, he argued that “some of the efforts” the Scottish Government was making were coming to fruition, helping people back into jobs and “generating employment for our young people”.

Labour’s shadow Scottish secretary, Margaret Curran, said: “Alex Salmond likes to claim credit when things go well, so he must now accept responsibility.

“Of course governments should meet, and they regularly do, but talking isn’t enough and can’t be used an excuse to avoid action. In the face of the enormity of the problem, this [talk of a summit] is just a red herring.

“The challenge remains that unemployment is going up in Scotland, and youth unemployment here is in full-blown crisis.

“The SNP shouldn’t just respond to bad headlines – they should respond to the very serious and very worrying economic challenges facing Scotland.”

Scottish Liberal Democrat leader Willie Rennie went for a similar line of attack. “These are shocking unemployment figures that are the exact opposite of what SNP ministers told us was happening,” he said.

“Unemployment is rising twice as fast in Scotland compared to the UK. Scottish ministers put out a complacent press release last month saying that they were ‘outperforming’ the rest of the UK because of their economic approach, that recovery was ‘being built’ and that their policies were ‘bearing fruit’.

“Those claims look hollow today. Their complacency has not helped the economy grow one single point.”

Scottish Secretary Michael Moore said there was “no hiding the fact” the figures were disappointing.

He went on: “Our main priority as a government is to return this country to sustainable and more balanced growth.

“This is not the time to introduce further uncertainty into our economy but for both the UK and Scottish governments to work together for the benefit of the people who are looking for long-lasting quality jobs.”

The Scottish Chambers of Commerce described the rise in unemployment as “extremely concerning”. Chief executive Liz Cameron said: “The high levels of youth unemployment are, of course, of particular concern, as we cannot afford for a generation of our young people to lose out on the development of their skills, which our country will so desperately need over the coming years.

“With businesses across Scotland battling to see their way through to the general economic recovery, they need the right support from governments north and south of the Border to employ more young people and gear up for future success.”

Separate figures yesterday showed private-sector employment had risen year on year by 30,300 in Scotland in the third quarter, outweighing a fall of 23,500 in public-sector jobs over the same period.

The private sector, including all financial institutions, now accounts for 77.7 per cent of Scottish employment – the highest share since devolution.

Meanwhile, Scottish Tory finance spokesman Gavin Brown said he was astonished Mr Salmond’s high-profile Council of Economic Advisers had failed to hold a formal meeting at any stage in 2011.

The last meeting of the group, which now includes the economist and Nobel laureate Professor Joseph Stiglitz, was in September 2010.

The next scheduled gathering is in the new year.

Mr Brown said: “In a week that we have seen the worst retail figures and unemployment increasing beyond the rest of the UK, people will be staggered that the Council of Economic Advisers has not met this year and, indeed, there will be a gap of around 14 months without a meeting.”

A Scottish Government spokeswoman said: “The Scottish Government published its response earlier this year to the previous Council of Economic Advisers’ last report.

“The term of office of the previous CEA ended at the election, the new CEA membership was announced by the First Minister last month and will meet for the first time next month.”