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As I See It

Jobs data and discovering the real economy

It can’t be easy being an opposition economy spokesman when the data keeps defying expectations.

A fall in Scotland’s unemployment rate to a record low of 3.8% must be causing headaches for those trying every possible means to blow holes in the numbers and the Scottish government’s economic record.

After the economy refused to follow expert forecasts and fall into recession, the jobless figures provide another blessing for Economy Secretary Keith Brown.

Even he seems a little bewildered by what is going on, with comments that resist triumphalism and adopt a cautionary tone. He must be opening his letters from the chief statistician like a schoolboy who receives better exam grades than he expected.

Yet there is a need for caution. As Graeme Roy, director of the Fraser of Allander Institute at the University of Strathclyde, points out. Whilst unemployment in the 16-64 age group fell by 45,000, this was nearly matched by the 40,000 increase in the number of people classified as being inactive – that is they are either not in-work or actively seeking work, he says.

The definition of inactivity includes a broad spectrum of individuals, from students through to people unable to work for health reasons and those who have given up looking for work.  

The figures also reveal that the number of self-employed people in Scotland is close to a record high. Indeed over the last year, the number of people working as ‘employees’ in Scotland actually fell by around 40,000 whilst the number of ‘self-employed’ workers rose 33,000. Overall, self-employment in Scotland has risen nearly 30% over the last 10 years.

This confirms the shift in work trends noted in this column earlier this week following publication of the Taylor review into modern working practices.

The self-employed includes many who might otherwise choose to sign on but instead have chosen to go-it-alone. This could be because they are prepared to take the risk, have some redundancy money to fall back on, or feel there is no prospect of ever being employed again because they have seen their skills disappear.

Lessons of New Waverley

New Waverley, the development that was dogged by controversy for more than a decade and had to change its name in the process, has had the last laugh.

Even before its centrepiece office block arises from the foundations now being laid it has exceeded expectations.  It will house 2,900 office workers in the biggest commercial property letting in Edinburgh for 20 years.

The fact that these will be UK government jobs will not be missed by those who’ll note the location of the new “Hub”, nestling in the shadow of St Andrew’s House, headquarters of the Scottish Government, and not much more than a stone’s throw from the Scottish parliament at the foot of the Royal Mile.

Leaving politics aside, the announcement is a vindication of those who persisted with this development, formerly known as Caltongate, which was plagued with objections and planning delays.

That it went ahead at all is a minor miracle, given the long gestation period and the failure of similar schemes.

The Hub at New Waverley: biggest letting

Artisan, the firm behind New Waverley, worked with JLL and the UK government property unit to make the Hub happen and fulfil a promise to breathe new life into a neglected corner of the city. The Adagio and Premier Inn hotels, and the reopened Arches as shops and cafes, have already begun to transform the area.

Pulling off this deal should be a reminder to the planning authorities, if one were needed, that demand for this sort of quality accommodation is exceeding supply. Investors want to be in Edinburgh and are willing to pay a price for the right location. This past week has also seen tentative plans unveiled for a giant office development close to Edinburgh airport, the latest in a number of big ticket schemes at various stages.

These projects need to be fast-tracked to ensure that the momentum is not lost and that investment continues to flow into the city. We certainly cannot afford another 10-years of bickering before the next big project comes to fruition.

 

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