Scottish Economy Takes Sharp Downturn but a Rebound is Expected

A report from the Bank of Scotland noted that Scotland’s economy slowed heavily in the first few months of 2014, but expects additional growth over the next few months. Bank of Scotland economist Donald MacRae notes that the economy slumped in the beginning of 2015, but expects stabilized growth to return sometime in the spring.

A report from the Bank of Scotland noted that Scotland’s economy slowed heavily in the first few months of 2014, but expects additional growth over the next few months. Bank of Scotland economist Donald MacRae notes that the economy slumped in the beginning of 2015, but expects stabilized growth to return sometime in the spring.

According to a survey from the central bank, more than half of the companies surveyed are undergoing positive and static turnover, with 33 percent undergoing a decrease. However, many firms remain upbeat, with 34 percent expecting an increase in turnover in the next six months. Another 46 percent stated that current turnover would continue, while 20 percent predict a downturn. The production and service sectors in particular are industries that have been hit the hardest. And even though exports are on the rise, many companies have reported slowdowns in new and continued business.

Scottish Unemployment Rises

According to recent data, unemployment rose by 6,000 to around 162,000 workers between the months of November and January. On the flipside, employment shot to 2,611,000 with the inclusion of 6,000 during those same months. The number of people applying for a Job Seeker’s Allowance dropped by 2,000 to 79,400 in the early months of 2015, which marks 27,700 fewer people than 2014. Even though the unemployment rate is 5.9 percent, which is slightly higher than the U.K. average of 5.7 percent, some economists argue that Scotland is still faring better than the rest of the British Isles.

Mixed Reviews on the Scottish Labor Market

Increased participation in the labor market as more people are searching for work explains the higher unemployment rate, and others point to problems in the oil and gas industry as reasons for the slight uptick in joblessness. Overall, 174,000 people have joined the labor force since 2010. But Scottish Labor spokeswoman Jackie Baillie is one of the many who are criticizing the government’s management of the economy, saying that Scots are forced to contend with an unstable job market. She also echoes the views of many when noting that neither the British, or Scottish, governments are addressing voter concerns.

Scottish Workers Face a Tough Road

According to recent data from trade unions, real wages have dropped over the past six years, the sharpest drop since the 1800s. But the wages of upper management grew by 23 percent in the past year, and women are earning less than they did in 2014. While officials are hopeful of the economy’s progress, the political establishment is forgetting about the average person who is dealing with depressed wages.