Scots economy shrinks by 19% as COVID lockdown bites

Scotland’s economy shrunk by 2.5% in the first three months of the year as the first impact of the COVOID lockdown hit home, official figures show today.

Construction is among the sectors hit during lockdown

And separate estimated figures for April suggest that the contraction reached 18.9% in the first full month of inactivity.

The official GDP statistics which indicated a 2.5% contraction between January and March are worse than the 2% contraction recorded across the UK as a whole, But the figures only take in the first week of full lockdown at the end of March and the true scale of the recession will be made clear when the figures for the second quarter emerge.

The bleak picture for Scotland follows growth of 0.7% in the fourth quarter of 2019.

Compared to the same quarter last year, Scotland's GDP has contracted by -2.3%, compared to equivalent UK growth over the same period of -1.6%

In addition, new monthly GDP statistics have also been published today for the first time by the Scottish Government to help track the economic impact of the coronavirus pandemic, and are seen as experimental statistics.

The new statistics show that Scotland’s GDP is provisionally estimated to have fallen by 18.9% during April, after a fall of 5.0% in March. This indicates the direct economic impact of COVID-19 in Scotland during the first weeks and full month of the lockdown phase.

Economy Secretary Fiona Hyslop said: “The coronavirus (COVID-19) pandemic is having an extremely serious impact on the economy right across the UK and - as these figures demonstrate - Scotland is no exception.

“Ever since the start of this crisis the Scottish Government has been working tirelessly to keep businesses afloat and ensure as many people as possible keep their jobs, and we will continue to do that. So far this has included a tailored package of more than £2.3 billion in business support.”

Labour Leader Richard Leonard added: “Today’s statistics demonstrate plainly the enormous damage done to Scotland’s economy by the coronavirus pandemic.

“We are now deep into uncharted economic waters with the prospect of mass unemployment looming. If action is not taken by both the UK and Scottish governments, with a clear plan to get the economy back on course, then we may be left with an economy in tatters. This is not just a downturn in the economic cycle, it is a structural shift in the economy.”

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