As more Scots join dole queue...
Interest rate rise looms on stronger UK economy
The number of people in work in Scotland fell by 17,000 between December and February, pushing the unemployment rate up. Scotland and the UK now have the same jobless rate – 4.2%.
While concerns were expressed over the upward trend in unemployment in Scotland, the strength of the UK economy has again raised the prospect of an interest rate rise next month.
Ben Brettell, senior economist at Hargreaves Lansdown, reckons it’s a “near-certainty” that interest rates will go up as wages are also rising at their fastest in nearly three years, the ONS confirmed.
Pay grew 2.8% in the three months to February and with inflation currently running at 2.7%, and expected to fall towards 2% this year, real wages are starting to grow again.
Markets are now said to be pricing in an 85% chance of a rate rise.
The last quarter rise in unemployment in Scotland has drawn calls for further action.
Scottish Minister for Employability and Training Jamie Hepburn chose to focus on the annual figures.
“Scotland’s employment rate has increased over the year and remains high by historical standards, with 81,000 more people in employment compared to the pre-recession peak,” he said.
“The unemployment rate decreased by 0.3 percentage points over the year to 4.2% and has been lower or the same as the UK for 13 of the past 14 months.
“We continue to outperform the UK on employment and unemployment rates for young people and women with 71.9.% of women and 57.3% of young people in employment in Scotland compared to 71% of women and 53.9% of young people in the UK.
“We are committed to growing Scotland’s already strong economy with our investment per head on economic development dwarfing that of the UK Government while we are investing a record £2.4 billion in enterprise and skills, £4 billion in infrastructure and £600 million in broadband.
Scottish Labour’s economy spokesman Jackie Baillie, said: “These figures once again lay bare the extent of SNP and Tory mismanagement of our economy.
“The unemployment rate in Scotland is up while employment is down. This is unacceptable and SNP ministers can’t bury their heads in the sand.
“The SNP government should be using the £11billion a year we spend on public contracts and procurement to drive up labour standards, pay more workers a real living wage and ban zero hours contracts – because falling income and security for workers leads to falling productivity.”
Andy Willox, the Federation of Small Businesses’ Scottish policy convener, said: “Today’s weak figures will make uncomfortable reading for those charged with looking after Scotland’s job markets.
“Scotland’s smaller businesses have a great record of creating jobs and opportunities in communities across the country.
“Governments in Edinburgh and London can do more to charge these firms with confidence about the future. For starters, we could look again at how the state buys goods and services.”