BUSINESS leaders have warned the latest jobless figures may be only a “taste of things to come”, after Scotland suffered more than the rest of the UK.
The Office for National Statistics reported the number of people in work north of the border fell 15,000 between April and June as the coronavirus lockdown took effect.
Scotland’s unemployment rate rose to 4.5 per cent with 124,000 out of work, compared to a UK-wide unemployment rate of 3.9%
Scotland’s employment rate fell to 74.3% over the quarter, compared to 76.4% for UK-wide.
However the UK figure included the biggest fall in employment in a decade, with the number of people in work down 220,000, the most since the financial crash of 2009.
The number of people claiming universal credit cross the UK due to unemployment or low pay has now risen 117% to 2.7m between March and July.
The ONS said the youngest and oldest workers were worst affected, alongside those in manual work.
The figures do not include the millions of people support through the UK Government furlough, which runs out in October.
With fears the end of the scheme will result in a catastrophic loss of jobs, opposition parties and business leaders called for it to be extended or replaced by new forms of support.
Andrew McRae of the Federation of Small Businesses in Scotland said: “Today’s stark statistics give us a taste of things to come, unless decision-makers intensify their efforts to rehabilitate the economy.
“At every turn, we must remember that these aren’t just numbers on a page but livelihoods lost. We need to help local businesses create and sustain jobs.
“The Chancellor could look to keep additional costs low by – for instance – cutting employer national insurance contributions.
“Wile we understand the rationale for winding down the furlough scheme, the UK Government can’t take the option of some form of meaningful extension off the table if things turn from bad to worse.
“This crisis will see tens of thousands of people in Scotland lose their jobs and look for new opportunities.
“Our skills and education networks need to be prepared for a surge in people looking to upskill and retrain.
“Similarly, we need to support and encourage those self-starters prepared to use a change of circumstance as the catalyst they needed to start their own business.
“On both fronts, we’ll need nimble but considered policymaking from the Scottish Government.”
Dr Liz Cameron, Chief Executive of the Scottish Chambers of Commerce said: “These figures continue to show how the furlough scheme has prevented severe job losses during the pandemic.
“But the rise in unemployment points to the direction of travel as the restrictions imposed to prevent the spread of the virus start to cause real economic damage.
“It also points to the risks to livelihoods when the jobs support falls off a cliff edge in October.
“To help businesses recruit and retain staff, more needs to be done to reduce the overall cost of employment and prevent substantial redundancies.
“This could include significant expansion of the Employment Allowance and a cut in employer National Insurance Contributions.”
Announcing £10m of support for apprentices, SNP business minister Jamie Hepburn said: “These statistics cover a full three months of lockdown measures before some businesses started to re-open, but still do not reflect the full impact of the pandemic on the labour market as the Job Retention Scheme is continuing to help support many people remain in employment.
“We continue to call on the UK Government to extend the Job Retention Scheme, particularly for those hardest hit sectors, for example travel, tourism and hospitality, which face significant long-term challenges likely to remain when the scheme ends in October.
“We have provided a package of support to businesses that totals over £2.3 billion to keep companies in business and people in jobs.
“It’s clear that with the lockdown in place, many companies have not been able to take on new apprentices.
“As the economy reopens we will do what we can to support those apprentices who are made redundant and encourage companies to look to the future and take on new starts. “Today, we’ve announced £10 million for a range of measures to recruit and retain apprentices and ensure that no one is left behind.”
SNP MP Alison Thewliss added said: “The Chancellor has a choice here and unless he steps back from moves to end income support schemes, it's clear the Treasury is not on the side of working people who are increasingly finding themselves in hardship.”
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