The Ernst & Young ITEM club, which uses the same model as HM Treasury, estimates that Scotland’s gross domestic product will increase by 0.7% next year compared with 1.1% across the UK.
In the current year the economists expect the Scottish economy to contract by 4.9%, compared with a 4.6% reduction in the UK.
Dougie Adams, senior economic advisor to the Scottish ITEM Club said: “The recession has exposed a number of areas where there are disturbing weakness, not least financial services, business services and the hotel and catering sectors, which have all significantly underperformed compared to the rest of the UK.
“As the recovery will be driven from outside Scotland, the ability of the Scottish economy to recover will depend on the response of its businesses to opportunities in export markets and in the rest of the UK.”
However, Adams noted that employment had held up better in Scotland than other areas.
This may reflect employers imposing measures intended to cut costs while retaining staff, such as involuntary part-time working and pay cuts.
Last week Strathclyde University’s Fraser of Allander Institute predicted that Scotland would almost certainly suffer a deeper recession than the UK as a whole for the first time since the Second World War – mainly due to a big drop in financial sector output.
It said recovery in Scotland in coming years will be slower than that UK-wide, as the economy north of the Border is hit particularly hard by cuts to public spending.
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