THE sun might be shining but the steady stream of grim Scottish and broader UK economic news has developed into a deluge.

Scotland continues to underperform the UK as a whole but all the signs are this is largely because of the oil and gas downturn, and probably also a stronger economic performance by the likes of London and south-east England amid the increasingly alarming housing market boom.

The latest quarterly survey from industry body Scottish Engineering, published today, adds to the downpour of economic misery. It paints a picture of a sector which continues to struggle greatly. It also seems to sum up the Scottish economy’s current woes.

Machine shops in Scotland, which are major suppliers of the oil and gas sector, are being hammered by the North Sea downturn. However, the malaise is far more broadly-based than that. As Scottish Engineering chief executive Bryan Buchan puts it, the performance of the sector north of the Border “largely reflects what is going on” in the UK as a whole.

Mr Buchan, although seemingly at pains to highlight success stories in the Scottish engineering sector including the performance of Mitsubishi Electric’s air-conditioning systems business at Livingston in West Lothian, says: “If you look at the UK economy as a whole, we are struggling to see growth come through.”

And, in a nutshell, that brings us to the big underlying problem.

UK growth, which has been entirely unimpressive in recent years as the Conservatives’ grand economic plan has failed, now appears to be slowing to a crawl. This is hardly surprising, and there are plenty of people who could, justifiably, tell Chancellor George Osborne they told him so.

Brian Ashcroft, emeritus professor of economics at the University of Strathclyde and economics editor of the Fraser of Allander Institute’s highly-regarded commentary, has been among those to warn repeatedly of the drag on Scottish and broader UK growth from the Conservatives’ austerity programme.

Jeremy Peat, visiting professor at the University of Strathclyde’s International Public Policy Institute, has also flagged austerity’s dampening impact.

It is crucial to recognise that, while Scotland’s economic troubles are being amplified by the North Sea sector’s woes, it is overall UK weakness which is at the root of these grim times north of the Border.

In the most part for good reason, much is being made of the detrimental economic impact of uncertainty ahead of the June 23 referendum on UK membership of the European Union.

However, Mr Osborne has been among those to flag this as a key factor in the UK’s weakening growth. And we must not lose sight of the fact he has been Chancellor for nearly six years now and, during that period, the UK economic scene has been characterised by disappointment after disappointment.

Surely no-one needs any further evidence that Mr Osborne’s March 2011 Budget vision of “a Britain carried aloft by the march of the makers” has failed to materialise. For anyone who remains unconvinced, the Scottish Engineering survey and latest report on UK manufacturing activity from the Chartered Institute of Procurement & Supply (CIPS) this week provide timely reminders of just how difficult things are for the “makers”.

CIPS’s most recent manufacturing surveys point to a significant decline in the sector’s output, on the official measure, in the second quarter.

And Scottish Engineering’s survey shows both output and new orders in its sector north of the Border have fallen for a sixth consecutive quarter. The run of decline in overall export orders for Scottish engineering companies is even longer, at 11 quarters.

And the survey signals another fall in the sector’s capital spending.

Scottish Engineering, as well as highlighting the lack of UK expansion and the North Sea’s troubles in explaining its sector’s continuing weakness, notes a slowdown in growth in many overseas markets.

Mr Buchan takes comfort from signs that some larger engineering companies are faring relatively well, but adds: “The real pain is being felt among the small to medium [sized] companies, particularly the machine shops.”

The survey itself does not dwell on the dark cloud that is the entirely unnecessary referendum on EU membership, a poll promised by Prime Minister David Cameron ahead of the 2015 General Election.

However, Mr Buchan raises this issue in his foreword.

He says: “After a protracted period of uncertainty over the last two years and more, it is to be hoped that, post-EU referendum, we get back to business as usual and that we see this reflected in performance across our sector.”

However, it will hardly be business as usual if there is a Brexit vote.

Lamentably, opinion polls continue to signal it could be a close call.

Mr Buchan prefers to stay in the EU, favouring the known over the unknown.

But his comments seem relatively diplomatic, given what would seem likely to ensue in the event of a Brexit vote in terms of damage to international trade and the overall UK economy.

Mr Buchan says of a Brexit scenario: “I wouldn’t anticipate that it would be a benefit to business. I would think that, from a business point of view, to remain within the EU, to carry on as we are, would be a benefit as we know what to expect if we stay in the EU. We don’t know what to expect if we [come] out.”

The impact of Brexit might be unknown but it is certain not to be pleasant. To borrow phraseology from former US Defence Secretary Donald Rumsfeld, let us hope sense prevails and we never have to deal with the known or unknown unknowns of Brexit.