Pressure grows on ministers over rise in jobless

Political Editor

Thursday 18 October 2012

MINISTERS in London and Edinburgh are facing renewed pressure to boost jobs and growth after further grim news for the Scottish economy.

ANGER ON THE STREETS: Youth campaigners marched from Stirling Castle to Glasgow to protest against cuts. Picture: Stewart Attwood

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Magnus Gardham Political Editor

Scotland slumped deeper into recession in the second quarter of the year, according to GDP figures showing the economy contracted by 0.4%.

Meanwhile, unemployment remained high. Just under one-quarter of one million able Scots remain out of a job (222,000), with the Scottish unemployment rate rising to 8.2% in August after 7000 more people stopped working between June and August.

Across the UK, the number of people out of work fell 50,000 to 2.53 million (7.9%) in the three months to August, according to the Office for National Statistics.Despite the higher joblesss rate in Scotland, the number of those claiming job-related benefits has come down by 1300. That leaves 139,900 Scots receiving jobseekers allowance and similar payments.The total claimant number includes an extra 18,000 young Scots out of work when compared with the previous quarter.Deputy First Minister Nicola Sturgeon said the figures showed "why Scotland needs the full powers of independence".However, her Government was held responsible by Labour and the Conservatives for doing too little to stimulate growth or address the growing problem of youth unemployment, which soared back over 100,000.The figures came as youth campaigners marched from Stirling Castle to Glasgow in protest against cuts to jobs, benefits and public services in a protest organised by the Public and Commercial Services Union.Meanwhile, Scotland's Gross Domestic Product (GDP), which measures the value of goods and services produced in the country, fell for the third successive quarter, figures showed.The latest 0.4% slump means the Scottish economy has flatlined year-on-year, compared with a 0.4% annual increase across the UK.Output in the struggling construction industry rose by 2%, but remained 10% down compared with the same period last year. The Scottish Government blamed the overall slump on a steep contraction in the electricity and gas sector after particularly high output in the first quarter.However, an analysis by Glasgow University's Centre for Public Policy for Regions think-tank showed that while Scotland did not sink as deeply into recession as the rest of the UK after the banking crash in 2008/9, it has failed to keep pace since.Scotland's rate of recovery since the last recession has been 1.7%, it said, compared with 3.5% across the UK.Ms Sturgeon said: "Today's figures show once again that Scotland is suffering under the UK Government's do-nothing economic policy. The UK Government must not be complacent – it is still clear that what is needed is a direct capital investment stimulus to boost the economy."LibDem Scottish Secretary Michael Moore admitted the figures were "disappointing and a cause for concern.But trades unions and business organisations demanded government action. STUC general secretary Grahame Smith warned: "The Coalition's damaging, unnecessary and ultimately self-defeating austerity project practically guarantees that the economic misery currently being visited on the Scottish people will persist for some considerable time." Colin Borland, of the Federation of Small Businesses said: "Unless governments at Westminster and Holyrood put the tax and enterprise support systems squarely behind realising small businesses' employment potential, job prospects will remain bleak."Gavin Brown for the Scots Tories added: "When unemployment in Scotland fell below the UK average, Salmond said it was all down to the work of the Scottish Government. Presumably the opposite is now the case."

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Pressure grows on ministers over rise in jobless

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