The current economic climate is having a serious impact on Scottish jobs and future business prospects. Newly published data from the Bank of Scotland, the Scottish Retail Consortium and the Scottish Building Federation confirm that consumer and economic confidence has been affected, despite the fact that Scotland's labour market improved slightly last month.
The Bank of Scotland's monthly report on jobs shows a small rise in the number of permanent and temporary staff being taken on. However, the starting salary for new recruits to full-time jobs has fallen for the first time in more than a year. The bank says that the figures point to rates of growth “below the respective long-run series averages”.
According to the bank’s chief economist, Donald MacRae, “Despite slowing growth in the eurozone and the UK, the number of people placed into permanent jobs increased after December's decline while the number of vacancies for permanent staff was broadly unchanged from the end of last year. This latest barometer suggests the Scottish economy is struggling to maintain growth momentum in challenging economic conditions.”
Just how challenging these conditions are is shown by the latest figures on footfall at Scottish shops. The latest report from the British Retail Consortium suggests that Scotland was also one of the worst affected parts of the UK over the last three months. Compared with the same period last year, there was a fall of 8.5 per cent in the number of people out shopping here.
In the view of Ian Shearer of the Scottish Retail Consortium, “These results are further evidence of the troubled times for Scottish retail. Even Christmas failed to bring shoppers out in Scotland. The drop of 8.5 per cent in footfall for the quarter sadly mirrors the worrying monthly sales figures in our recent Scottish retail sales monitor reports, which have shown the worst declines for over a decade.”
The position is even worse in the Scottish construction sector, which has seen another sharp drop in confidence levels. A survey for the Scottish Building Federation (SBF) reports that its members expect to see public sector contracts fall further this year. Only 9 per cent expect to take on new staff this year, while 30 per cent expect to cut their workforce.
In total, 79 firms completed the survey. Only 10 per cent expected to see house-building pick up; 40 per cent say it will continue to decline from already low levels. Only those firms involved in repair and maintenance show any signs of confidence, believing they have the best prospects for winning contracts.
“The industry has already lost 30,000 jobs in the space of a year," said Michael Levack of the SBF. "But with more firms anticipating they will have to make redundancies this year than those hoping to recruit, there's a real prospect that industry employment levels could drop further yet before they start to recover.
"Over the coming months, I hope the industry can work constructively with government at all levels to start rebuilding confidence that has been shattered by the economic downturn. An excellent place to start would be to start dismantling the huge unnecessary bureaucracy around procurement and planning that has stifled our industry for far too long.”
In a statement, the Scottish government said that “we are using every lever currently available to us to secure new investment and create and safeguard jobs, in the face of severe cuts from Westminster. We need the UK government to follow suit and implement a 'Plan MacB' approach for the UK economy – increasing capital investment, securing consumer confidence, and ensuring that businesses have access to finance to create the conditions necessary for recovery.”
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