Scotland falls behind rest of UK as jobless total rises

The number of people out of work in Scotland now stands at 135,000. Picture: John Devlin
The number of people out of work in Scotland now stands at 135,000. Picture: John Devlin
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Scotland’s jobless total has jumped again – in contrast to the UK figure falling to a ten-year low.

Economic growth is also falling behind the UK over the past year as the impact of the oil slump continues to bite and concerns escalate over hikes in business rates.

The figures have led to renewed calls for the SNP to ditch plans for a second referendum amid claims that the economic case for independence has collapsed, as the country’s trade deficit now tops £3 billion.

The number of people out of work north of the Border has increased for the third successive month, the official figures yesterday revealed, rising by 6,000 between October and November last year and now stands at 135,000. Across the UK, unemployment fell by 7,000 to just under 1.6 ­million.

There has been a rise in the number of people in work in Scotland, with 8,000 additional employees. This can be explained by an increase in the size of the labour market by ­factors such as students leaving ­university. ­Scottish Secretary David Mundell said: “There is cause for some cautious optimism about the state of Scotland’s labour market, with employment up and more women returning to the labour market. However, declining economic activity during the last 12 months, and the gap between the Scottish and UK labour markets, remains a concern.

“We have devolved a raft of new powers to the Scottish Parliament. It now needs to use those levers to strengthen the Scottish economy.”

The Scottish unemployment rate is 4.9 per cent, which is above the rate of 4.8 per cent for the whole of the UK. The number of people in employment in Scotland now stands at 2.61 million.

The Scottish Government’s minister for employability and training Jamie Hepburn said the figures show Scotland’s labour market remains “resilient”.

He added: “We are working to build an economy where everyone can share in the benefits of economic growth. It is therefore encouraging to note this rise in the number of people in work alongside some positive statistics on female and youth employment, where we continue to lead the UK. In terms of low youth unemployment rates, we are second only to Germany within the EU.”

Scotland’s GDP was up by 0.9 per cent in the third quarter last year, compared with 0.8 per cent in the rest of the UK, the latest National Accounts also revealed yesterday.

But Scottish growth remains 1.4 per cent below the level seen two years ago, compared with a rise of 6 per cent across the UK, as the impact of the oil price slump continues to take its toll.

The UK economy also enjoyed growth of 4 per cent over the year to September 2016 – compared with just 0.2 per cent in Scotland.

Professor John McLaren, of Scottish Trends, said: “While the third-quarter figure for Scottish GDP (in cash terms and including North Sea activity) is positive, the longer run position remains poor, with the level of GDP still below what was seen two years ago.

“Furthermore the Scottish trade balance for 2016, while improving a little in Q3, is still likely to worsen by over £3 billion from 2015.”

The country’s trade deficit has increased by an estimated £111 million over a year to just over £3bn.

Scottish Labour’s Westminster spokesman Ian Murray said: “These figures show that there is no economic case for a divisive second independence referendum.

“Scotland’s economy continues to under-perform relative to the UK and there are significant challenges ahead. North Sea revenues have collapsed and Scotland’s trade deficit is approaching record levels.

“While UK gross domestic product has increased in recent years, Scotland’s GDP remains below the level seen two years ago, in large part due to the downturn in the North Sea oil and gas industry. The Scottish Government should stop being distracted and concentrate on improving Scotland’s economic performance.”

The flatlining economic picture in Scotland comes as many firms, particularly in the hospitality industry, face hikes of up to 250 per cent in their business rates valuations.

Colin Borland of the Federation of Small Businesses in Scotland yesterday called for SNP ministers to take action on the issue.

He said: “This year’s rates revaluation is proving controversial both north and south of the Border.

“Smaller firms in Scotland benefit from the most helpful reliefs anywhere in the UK – but this property-based tax requires urgent modernisation.”