Scotland to suffer years of jobless misery

THE rate of unemployment in Scotland has now surpassed the UK average and is set to remain that way for an "extended period" as a result of a major squeeze in public-sector spending, experts have said.

• Picture: TSPL

Official figures, published yesterday, revealed that the Scottish jobless total soared to 8.1 per cent compared to a UK-wide figure of 7.8 per cent. It is the first time in four years that joblessness north of the Border has exceeded the UK average.

The labour-market statistics showed there are now 216,000 unemployed people in Scotland, up by 8,000 during the period from March to May this year.

Unemployment figures, which include those who are out of work but not eligible for benefits, across the UK fell by 34,000 to 2.47 million during the same period.

In recent years Scotland has been cushioned by a large public sector,

which is always slower at shedding staff during hard times.

But writing in today's Scotsman, David Bell, professor of economics at Stirling University, forecast that cuts expected to hit public services next April meant that Scotland's unemployment rate would be higher then elsewhere for a significant time.

He said: "There is nothing that suggests that Scotland is not going to have an extended period when unemployment is more than that of the UK as a whole."

"Next April the cuts are going to kick-in in a big way."

Meanwhile, a leading member of local government umbrella body Cosla warned public sector jobs could come under pressure for up to a decade as the spending squeeze continues.

Scotland's jobless rate was higher than the rest of the UK between 1995 and 2006 – a period that covered the immediate aftermath of the decline of the country's electronics industry. In April 2006 the unemployment rates for Scotland and the UK crossed at 5.5 per cent.

Scotland's figures for the number of people in employment also fell by 9,000 during the period March to May to 2,443,000 – with the total 65,000 lower than the same time last year.

The UK-wide figure for the number of people in work rose by 160,000 in the three months to May, the biggest rise since August 2006.

Lib Dem Cosla vice president Neil Fletcher said: "The public sector is going to face an element of contraction over the next five to ten years. As the public sector employs a large number of people, it's important that there's investment in the private sector to create more jobs."

Scottish Secretary Michael Moore, who previously said the country was facing "brutal" cuts due to the UK's annual deficit of 155 billion, said the jobless rate showed "the real human cost of the economic legacy the government has inherited".

Mr Moore said: "Each rise in unemployment is serious and shows the scale of the challenge we face in getting the economy back to health. There is no doubt Scotland's governments must work together to do everything we can to help those who have lost their jobs back into work as quickly as possible."

Mr Moore claimed that the Tory-Lib Dem coalition Government's budget would "tackle the record deficit and help us achieve balanced economic growth across the UK".

He said: "These measures will keep interest rates lower for longer and encourage investment, both of which are important for the creation of new jobs."

The latest figures showed that, although the UK overall saw a 0.1 per cent fall in unemployment, the number out of work rose in Scotland by 0.3 per cent, by 0.1 per cent in Wales and by 0.6 per cent in Northern Ireland. Labour's finance spokesman, David Whitton, claimed that Scotland was "taking a double hit from the Con-Dem cuts and the Salmond slump".

He said: "It is scandalous that this SNP Government has cost Scotland thousands of construction jobs by failing to get key building projects off the ground.

"They've chosen instead to spend Scotland's money on pet projects such as the independence referendum which has yet to see the light of day.

"Scotland should not be lagging behind the rest of the UK in employment rates and it's time for Alex Salmond to do something about it.

"Getting people back to work must be the top priority of this government to halt the growing unemployment figures."

Mr Whitton went on to hit out at the Tory-Lib Dem coalition government over its VAT hike, which he said would harm those on low incomes, including the unemployed. He said: "Those out of work will be worse off after the Con-Dems pushed through a VAT rise."

But Tory finance spokesman Derek Brownlee blamed the "disappointing" unemployment figure on the last Labour government at Westminster and said they showed "more than ever the need for the Scottish and UK governments to work together to help the private sector create new jobs".

He said: "Scotland has relied too heavily on public-sector employment in the past and it is time to focus on helping new businesses and supporting small business."

Lib Dem finance spokesman Jeremy Purvis accused the SNP government at Holyrood of failing to take action over unemployment. Mr Purvis said: "These unemployment figures again highlight the real impact of the devastating impact of the recession on people in Scotland.

"It is hugely concerning that while the UK figures continue to fall; joblessness in Scotland continues to grow. This continued rise must be reversed."

Unions also warned of "significant" public sector job losses and an increase in unemployment if there were major public spending cuts.

Unite T&G union organiser Tommy Campbell said: "With the onslaught that's going to take place unemployment will get a lot worse."

Finance Secretary John Swinney said Scotland was still showing "fragile signs of recovery" and highlighted a fall in the number of Job Seeker's Allowance claimants of 600 to 133,200 between May and June.

"The figures highlight a fifth consecutive monthly fall in the number of people claiming jobseeker's allowance, and our unemployment rate remains below many other parts of the UK, such as London, Wales, the North East of England, North West and Yorkshire and the Humber," he said.

But he said economic recovery was still in the "early stages" and hit out at the UK Government over unemployment.

Mr Swinney said it was "wrong to risk jobs and recovery through spending cuts that are too quick and too deep, and come on top of those already imposed on Scotland by the previous Westminster administration".

He said that the Scottish Government has opted to defer its share of 6bn of cuts already imposed by Westminster.

"These figures show the Scottish Government was right to defer further Westminster cuts to next year in order to support recovery and maintain employment now," he said.

"The statistics also demonstrate the importance of the action we are taking to support recovery, prioritise frontline services and creating and protecting jobs through the implementation of our economic recovery plan, which is directly supporting up to 15,000 jobs."

Michael Levack, chief executive of the Scottish Building Federation, said the figures showed 3,000 jobs had gone in the construction industry in the first three months of 2010, and that the sector had lost 32,000 jobs over the past year. He added: "For an industry of such crucial importance to the economy to lose 17 per cent of its workforce in a year is truly frightening."

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