Unemployment in Scotland is up by 5,000, with some 215,000 recorded as out of work in the three months from July to September. It means that the unemployment rate north of the border stands at 8 per cent, just below the UK average of 8.3 per cent. Across the UK, unemployment increased by 129,000 over the same period to 2.62 million.
The labour market statistics, produced by the Office for National Statistics, also show that employment in Scotland has fallen. The number of people with jobs in Scotland now stands at 2,478,000, down by 28,000.
The news prompted the finance secretary, John Swinney, to insist that there was an urgent need for a "Plan MacB" approach. “The UK government,” he said, “must deliver real action in the areas where Scottish government policy is making a difference – increased capital expenditure, improved access to finance for medium and small-sized businesses, and the introduction of measures to boost economic confidence and income security.
“The Scottish government and our enterprise agencies are working hard to secure new jobs and investment, and to retain Scotland's position as the most competitive environment for business in the UK, through measures such as the Small Business Bonus Scheme.”
The secretary of state for Scotland, Michael Moore, described the Scottish figures as "a stark reminder we cannot allow any let-up in our efforts to get the economy back to full health and people back into work as soon as possible. Each of these numbers represents an individual or a family directly affected by the economic downturn and the UK government is doing all it can to create growth and reverse this trend.”
Both sides of business agreed that the figures were extremely disappointing, especially since Scottish unemployment has risen for the second consecutive month. “Whilst it is important to remember that our overall unemployment rate of 8 per cent is still marginally below the UK average," said Liz Cameron, chief executive of the Scottish Chambers of Commerce, "the fact remains that economic conditions remain challenging in Scotland.
"Growth remains extremely shallow; business and consumer confidence are low and the potential fallout from the eurozone crisis is of extreme concern. Scotland cannot afford for skilled individuals to remain unemployed for any length of time and we need to give our businesses the support needed to get these people back into work as soon as possible.”
Grahame Smith, general secretary the Scottish Trades Union Congress, said it was an “insult to the intelligence of the Scottish people” for coalition ministers to blame rising unemployment on the eurozone crisis.
“Since the banking crisis was at its height over three years ago," Mr Smith said, "the STUC has consistently warned that the mistakes of past recessions are in danger of being replayed. That this now looks more an inevitability than a possibility is a shocking indictment of the coalition government and a tragedy for the unemployed and communities across Scotland."
The figures came on a day when the governor of the Bank of England reported that the UK's economic outlook had worsened, warning that the economy could stagnate until the middle of next year. The bank cut its growth predictions over the coming years to about 1 per cent. Sir Mervyn King described the eurozone debt crisis as the "single biggest risk" to the UK.
In his quarterly inflation report, Sir Mervyn said the UK's economic problems were shared by other countries. “The immediate impact of the decline in sentiment,” he said, “is that the outlook for growth for the world economy has worsened since August. This is also true here in the United Kingdom, where activity could be broadly flat until the middle of next year.”
He argued that inflation had peaked and was likely to fall sharply over the next few years. Last month, the Consumer Price Index fell slightly to 5 per cent during October, down from a rate of 5.2 per cent the month before. According to analysts, the lower forecasts for growth and inflation mean the Bank of England will probably leave interest rates at the low level of 0.5 per cent for months to come.
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