Economy – Page 27 – The NEN – North Edinburgh News

Scottish employment hits record levels

Both UK and Scottish governments have welcomed news that employment in Scotland is at the highest level since records began – but they disagree over what’s best for Scottish jobs and the economy: the union or independence.

Figures published today by the Office for National Statistics show that total employment increased in Scotland by 63,000 over the year to reach 2,594,000 – the highest level since records began in 1992. 73.5 per cent of people are now in employment in Scotland.

Female employment has also reached a new record high with 1,250,000 women in Scotland in employment, an increase of 36,000 over the year.
The figures also show that Scotland’s youth unemployment rate has decreased by 2.9 percentage points over the year and now has a youth employment rate of 55.6%.

The overall employment level has now increased over the quarter for 18 consecutive monthly releases – the longest ever unbroken run of increasing quarterly employment.

Over the year the number of people unemployed fell by 21,000, with the unemployment rate now standing at 6.4 per cent. The number of people claiming Jobseekers Allowance has fallen by 35,500 – or 27.6 per cent – over the last year.

Separately, the Scottish Government has today published its latest Quarterly National Accounts statistics for Scotland, which demonstrate the continued strength of the economy. Over the latest four quarters, total GDP including offshore activity has reached nearly £148 billion, and at around £27,700 per person is 10 per cent higher than the equivalent UK figure.

Cabinet Secretary for Training, Youth and Women’s Employment Angela Constance said: “We know that Scotland’s economy has returned to pre-recession levels and these figures show that our recovery is continuing to gain momentum, with unemployment down and employment at its highest level ever.

“I am pleased to see that youth employment has increased and that fewer young people are now unemployed in Scotland compared to a year ago. It is so important that our young people have the chance to get a foothold in the labour market and we want to see this figure continue to decrease.

“That is why we have extended the Youth Employment Scotland Fund, which now helps employers seeking to recruit those aged 16 to 30. In particular this will help those most at risk of being cut off from the labour market such as young working mums, care leavers and disabled people.

“Our ambitions are greater than this – that’s why we are taking forward the commitments set out by the Commission for Developing Scotland’s Young Workforce to reduce youth unemployment in Scotland by 40 per cent by 2020.

“Female employment continues to increase and now sits at the highest level since records began and the female unemployment rate is at its lowest since May-July 2009.

“This government will always do everything we can to ensure women have the same opportunities in the labour market as their male counterparts, and have access to quality sustained work in careers they choose.

“As part of our recovery we must ensure that everyone is able to benefit from a growing economy. For example, our transformational plans for childcare will not just be good for children, but also their parents, giving them greater opportunities to enter work or training.

“These figures show that Scotland has the economic potential to be an independent country. With the full powers of independence we could do more to get people into work and give employers access to the skills they need to grow their business, strengthening our economy and creating jobs.”

Scottish Secretary Alistair Carmichael also welcomed the latest statistics – but drew different conclusions, of course!

Mr Carmichael said: “Today’s figures show we have a new record high in overall employment. Over the last 12 months Scottish employment has increased by 63,000 and unemployment has fallen by 21,000. This shows that working together as part of the UK with its larger market, stronger and growing economy and stable currency is creating more jobs and better opportunities for Scotland.

“It is also good to see the number of people claiming Jobseekers allowance continues to fall. It is now at its lowest level since October 2008 and is 35,500 lower than one year ago.

“Each one of the figures today represents another person or household getting back into the labour market. It also represents the certainty, stability and security we are creating for businesses by being part of the UK. We will continue with our long term economic plan to ensure that these positive figures are reflected in communities across the length and breadth of Scotland and our business have the confidence to grow and employ more Scots.

The Minister made the comments as he visited Frolick, a Dundee based family run company that specialises in healthy alternatives to frozen desserts. Over the past few months the company has greatly expanded its range.

They have benefited from the New Enterprise Allowance (NEA), an initiative which offers expert mentoring and financial support to people on Jobseeker’s Allowance, lone parents and people on sickness benefits who want to start up their own business. Since its launch in 2011, 3,300 businesses in Scotland have been established thanks to the NEA.

Mr Carmichael added: “It was great to visit this thriving family run business in Dundee. Across the country the New Enterprise Allowance is helping thousands of jobseeking Scots build a career and fulfil their ambitions. The great ideas of these entrepreneurs today may transform into successful Scottish companies which will be the major employers of tomorrow.”

Scottish Government unveils jobs plan

Independence will equip Scotland for the first time ever with a fully-powered economic policy aimed at putting job creation in Scotland first, the Scottish Government says. Published today, A Jobs Plan for an Independent Scotland sets out a long-term, ten-point jobs plan for an independent Scotland.

The paper aims to show how, with control of economic and tax policy – ‘and – crucially – by bringing business, unions, government, and other partners together – we can build on Scotland’s strengths and create more and better job opportunities.’

The aim is to create the conditions where everyone able to work has the opportunity to do so.

Commenting on the plan, Finance Secretary John Swinney said: “Independence is a once in a lifetime chance to shift the balance of opportunity in Scotland’s favour – equipping our country with the powers we need to build secure, stable and rewarding employment for everyone who lives here.

“Independence is not a magic wand but the plan we have published today shows how future governments of an independent Scotland could tailor economic policy to put job creation first and deliver a long-term employment boost. With the right policies in place we could achieve full employment – giving our businesses a competitive edge and incentives to create more and better jobs here in Scotland.

“Few, if any, countries in the world, have the economic potential of Scotland. We have a talented and skilled workforce, world-leading universities, a modern college sector and a successful modern apprenticeship system.

“We have a strong international reputation for producing quality goods and services with notable success in sectors such as food and drink, the creative industries, life sciences and modern manufacturing.

“Our natural and energy resources are unrivalled: in 2012 we produced nearly six times our oil demand and we have huge renewable energy potential.

“With the limited powers of devolution Scotland’s economic performance has improved but far too many Scots still feel they have to leave each year to get a job or further their career.

“Of course many people will always want to travel and work elsewhere – but that must be a choice and not a requisite for those looking to succeed.

“With independence our economic policy would be tailored precisely to our own needs – for example in order to resist the gravitational pull of London, we would be able to cut the headline corporation tax rate by up three per cent which could boost employment by up to 27,000 jobs.

“The gains of independence will only happen if we work hard and use policy wisely. But what is clear is that no-one else is better placed to take decisions about the Scottish economy than the people who live, work and run businesses here.”

The Scottish Government has previously set out how improvements in productivity, employment and population could lead to additional tax revenues of £5 billion a year by 2029-30. The jobs plan will contribute to that increase by:

• Creating an education and training environment to equip our young people to fulfil their potential, with a target of 30,000 Modern Apprenticeship starts per year by 2020;

• Controlling the tax system to provide incentives for companies to base their operations and headquarters in Scotland and create jobs. A three per cent cut in the headline corporation tax rate, in part to resist the gravitational pull of London, could boost employment by 27,000 jobs;

• Using employment policy to bring together employers and unions to boost workforce participation, skills and productivity, in place of the UK Government’s confrontational approach. Boosting productivity by just 1 per cent could increase employment in Scotland by 21,000 jobs over the long term;

• Tailoring policy to boost key job-creating sectors in which Scotland has an international comparative advantage, such as renewable energy;

• Reindustrialising Scotland with a focus on strengthening manufacturing, promoting innovation and encouraging international trade and development;

• Boosting infrastructure and transport by establishing a rule which sets a minimum level for public sector capital spending as a percentage of GDP;

• Establishing a Scottish Business Development Bank as part of a strategy to improve access to finance for growth companies;

• Using a new overseas network of 70-90 embassies dedicated to boosting Scottish international exports. In the long-run a 50 per cent increase in exports could increase employment by over 100,000;

• Increasing opportunities for parents of young families to participate in the labour market by expanding childcare.

• Tailoring immigration policy to retain talented overseas students who want to contribute to the Scottish economy.

Opponents of independence argue that the ten-point plan has no credibility; they say that until the government provides an answer on what Scotland’s currency will be, then savings, pensions, mortgages, rents and jobs are at risk as the government’s economic plans are based on ‘guesswork.’

Carmichael welcomes positive economic report

A report highlighting positive signs for Scotland’s economy has been welcomed by Scottish Secretary Alistair Carmichael.

The Bank of Scotland’s latest Purchasing Managers Index (PMI) survey says business activity rose at the fastest rate in six months in July, supporting continued employment growth. It also reports a ‘robust increase’ in overall new business and adds that Scotland’s private sector output increased at a “sharp and accelerated rate”.

The bank’s Purchasing Managers Index (PMI) – a measure of the month-on-month change in combined manufacturing and services business activity – was at a six-month high of 56.8, up for the second straight month from 55.9 in June and 54.0 in May.

Commenting on the latest economic report, Mr Carmichael said: “Today’s PMI report shows that being part of the UK with its larger market, stronger and growing economy and stable currency is creating more jobs and better opportunities for Scotland.

“As we move into the second half of 2014, this report shows that Scottish employment has grown for the 20th straight month. This builds on the encouraging economic signs so far this year, such as reaching a record high in employment, more Scottish women in work than ever before and the UK’s economy being predicted to grow faster than any other G7 economy.

“It is also very encouraging to see a rise in the number of new Scottish businesses. Backing small businesses is a vital part of the government’s long term economic plan. Since 2010, 3,300 entrepreneurial Scots have moved from Jobseekers Allowance to becoming their own boss and since its introduction in April this year, 57,000 Scottish businesses have already taken advantage of our employment allowance.”

Green MSP: ‘ immigration is good for our economy and society’

MIGRATION: GREEN MSP WELCOMES STUDY SHOWING ECONOMIC BENEFITS

Alison Johnstone, Green MSP for Lothian and a member of Holyrood’s economy committee, is welcoming new research showing that the Westminster consensus to reduce migration risks harming the economy.

A new report by the National Institute for Economic and Social Research (NIESR) shows that a cap on migration would create an economic shortfall. NIESR warn of “a reduction in the pool of talent available to businesses.”

Earlier this year a poll for the Scottish Green MSPs showed two-thirds of Scots want Holyrood to have control over immigration policy. None of the parties campaigning for a No vote has offered to devolve it.

A recent study by the Centre for Population Change also showed that local authorities in Scotland view migrants as positive but don’t always have the resources needed to welcome them.

Alison Johnstone MSP said: “This latest research supports the Green view that immigration is good for our economy and society. Our local authorities need better resources and greater control to get the best results, and Scotland needs the power to set its own policy.

“The debate being played out at Westminster, stoked by fear and hostility, bears little relation to the situation in Scotland and risks throwing away so much potential. I’m for a welcoming policy, and I want Holyrood to have the ability to secure the benefits of immigration for our communities.”

Pensions: millions to benefit from impartial advice

Millions of people will benefit from a right to free and impartial guidance on how to make the most of the new pensions choices that come into effect in April 2015, Chancellor of the Exchequer George Osborne announced today. This follows the Westminster government’s consultation on how best to deliver the radical changes to how people access their pensions announced at the Budget.

In total 18 million people will be able to benefit from the changes to pensions should they wish to do so.

From April 2015 300,000 individuals a year with defined contribution pension savings will be able to access them as they wish when they turn 55 – subject to their marginal rate of tax.

This is the biggest change to how people access their pensions in almost a century, removing the effective requirement for many to purchase an annuity.

The consultation since the Budget has shown that these changes have been overwhelmingly well received, with individuals supporting greater freedom and choice, and the pensions and insurance industry ready for the challenge of creating new, flexible products, which better suit individuals’ needs.

The government’s response to the consultation today confirmed that:

the guaranteed guidance on pensions choices will be provided by independent organisations rather than pensions schemes or providers
even more people will be able to benefit from the new pensions flexibilities as the government will continue to allow individuals to transfer from private sector defined benefit schemes to defined contribution pension schemes – subject to two important new safeguards
a new override will be introduced so that pensions schemes are able to offer individuals flexible access to their savings and the pensions tax rules will be amended to allow providers to develop new retirement income products that are tailored to the needs of individual consumers

Chancellor of the Exchequer, George Osborne, said: “It’s right to support hard working people that have taken the long-term decision to save for their future and I’m pleased that the responses we had to our proposals on making pensions more flexible have been overwhelmingly positive.

“We’re making sure that people have the right support to make their own choice about how best to finance their retirement and I’m pleased to confirm that everyone with defined contribution pension savings reaching pension age will get free and impartial guidance on their range of available choices at retirement.”

The government wants to ensure that guidance is trusted by consumers, and the vast majority, including most of the financial services industry who responded, said that consumers would not trust guidance given by a person or organisation with a vested interest in selling a financial product or service. It will bring together a range of delivery partners, including the Pensions Advisory Service (TPAS) and the Money Advice Service (MAS), which already provide guidance and support to consumers.

People with private sector defined benefit savings will continue to be able to transfer to defined contribution schemes (excluding pensions that are already in payment), alongside two new safeguards to protect both pension schemes and the individuals transferring out.

Guidance will be offered through a broad range of channels, including web-based, phone-based as well as face-to-face, and to remain free to the consumer will be funded by a levy on regulated financial services firms.

The Financial Conduct Authority (FCA) have also today published a paper which consults on the elements of the guidance guarantee for which the FCA will be responsible: setting and monitoring the standards with which guidance providers will have to comply, making and enforcing rules on how contract-based schemes signpost to the guidance services, and adjusting the FCA’s existing conduct rules to support the introduction of the guidance guarantee and in response to the new flexibilities.

Two new safeguards are being introduced to protect both individuals and pension schemes in relation to defined benefit to defined contribution transfers: a new requirement for an individual to take advice from an impartial financial adviser regulated by the FCA before a transfer can be accepted; and, new guidance for trustees on the use of their existing powers to delay transfer payments and take account of scheme funding levels when deciding on transfer values.

HM Treasury also published the following guide today:

Pension Reforms: Eight things you should know

Understanding the pension system can be complex sometimes. We’ve explained how the new system will work and what it means for you.

1. We’re completely overhauling the system so you can take your pension how you like

In order to create greater choice and flexibility for people who have saved hard for their pension, we announced at Budget 2014 a series of changes to how people access their pension.

From April 2015, no matter how much you decide to take out from your pension after retirement, you will be charged the normal rate of income tax you pay on your salary (so either 0%, 20%, 40% or 45%) rather than the previous tax charge of 55% for full withdrawal.

2. 25% of your pension pot will remain completely tax-free, as it was before

You’ll be able to access 25% of your pot in one go without paying any tax.

3. We previously announced this would apply just to people with ‘defined contribution’ pensions

This is a type of pension also known as a ‘money purchase’ scheme.

This is when the money you and your employer pay in is invested by a pension provider chosen by your employers. The amount you get when you retire usually depends on how much has been paid in and how well the investment has done.

4. We’ve now announced that people who have a ‘defined benefit’ scheme will benefit too

A ‘defined benefit’ pension is typically a promise of a certain level of pension in retirement which is linked to your salary.

We’ve now announced that people in the private sector or in a funded public sector scheme will still be able to transfer from a defined benefit pension scheme to a defined contribution one if they want to, meaning they can benefit from the changes.

This means that around 18 million people will ultimately be able to withdraw their pension flexibly should they wish to do so.

5. Everyone who will be able to take advantage of the new reforms will be able to access free and impartial guidance

This will help people make confident and informed choices on how they put their pension savings to best use.

This guidance will be available through a number of different channels – via an online tool, over the phone, or face to face. Individuals will be able to choose the channel, or mix of channels, that they find most convenient.

It will be entirely impartial, so won’t be given by anyone who could be trying to sell you a product.

6. Your pension provider or scheme will be required to tell you about the guidance and how to access it

Accessing the guidance will be arranged by your pension provider, who will be required to tell you about it.

7. The changes will come into effect from April 2015

If you are over the age of 55, or will be from April 2015, you will be able to take advantage of the new system from then.

If you’re younger than 55 then you will be able to take advantage of the new system when you do reach 55.

8. You don’t need to do anything until then

If you’re thinking about retiring soon, you don’t need to do anything in the meantime, but we’ve also made other changes to help you save until then, such as our reforms to ISAs.

You can find more information about the pension reforms by reading our factsheet we published at Budget explaining the differences between the new changes and the old system, or more details on our response to the consultation.

Employment up in Scotland

In a rare outbreak of agreement, both Westminster and Holyrood governments welcomed the latest employment figures published today. However Scottish Secretary Alistair Carmichael said the figures show the Westminster government is making the right choices for Scotland, while Finance Secretary John Swinney countered that Scotland would perform even better with the full powers of independence.

Employment in Scotland has increased by 12,000 over the three months from March to May, according to Office for National Statistics (ONS) data released today. The number in employment in Scotland now stands at 2,587,000.

Unemployment in Scotland increased by 13,000, to 192,000 in the period March to May 2014. The Scottish unemployment rate is 6.9 per cent, which is above the 6.5 per cent for whole of the UK.

Scottish Secretary Alistair Carmichael said: “We have seen positive developments over the year as a whole with 76,000 more Scots in employment and 13,000 fewer in unemployment. In June alone, the number of people claiming JSA fell by 4,000 and is now 35,500 lower compared to one year ago. Claimant count is now below 100,000 and at its lowest level since December 2008.

“Today’s news reminds us we need to continue creating the right conditions to get people into jobs. While it is disappointing to see unemployment rise at any time, the news comes against a backdrop of record overall employment, female employment and record private sector employment. The number of economically active people in Scotland is rising and the number of Scots claiming unemployment has now fallen for 16 consecutive months.

“This Government is making the right choices for a stable, growing economy and the jobs that come with it – those are the best choices for Scotland and the people who live here.”

Headline Statistics for the March to May 2014 quarter:

Employment in Scotland increased by 12,000 over the quarter, and increased by 76,000 over the year, to stand at 2,587,000
The Scottish employment rate remained unchanged over the quarter to 73.3 per cent. The rate is just above the UK average of 73.1 per cent
Unemployment in Scotland increased by 13,000 over the quarter and fell by 13,000 over the year. The level now stands at 192,000
At 6.9 per cent, the Scots unemployment rate is above the 6.5 per cent for the UK as a whole
Economic Activity increased by 25,000 over the quarter and now stands at 2,779,000. Also, the Economic Activity rate increased over the quarter to stand at 78.8 per cent
In June 2014, the number of people out of work and claiming Jobseeker’s Allowance (JSA) was 96,000

Responding to the latest labour market and GDP figures Finance Secretary John Swinney said: ““Today’s figures mark an important stage in our recovery.

“These positive output figures show that Scotland’s economy continues to go from strength to strength with growth of 1.0 per cent over the quarter and 2.6 per cent over the year – the fastest annual growth in over three years.

“Nearly six years on from the start of the financial crisis, our economy is now larger than before the downturn. Output in Scotland is at record levels and we have exceeded our pre-recession peak at least one quarter ahead of the UK.

“Over the last quarter the improvement in our economy has been broad-based with welcome signs of growth in manufacturing which was up 3.4 per cent and services which account for over 70 per cent of our economy up 0.9 per cent.

“Today’s output figures are supported by new labour market data which show employment has reached a new record in Scotland with our economic activity rate also hitting a record high.

“As the economy recovers more people are moving from inactivity into the labour market to look for employment. With this boost to economic activity it is not surprising that both employment and unemployment have risen over the quarter – albeit unemployment is still down over the year.

“These figures support the emerging body of evidence which all point to the recovery in Scotland continuing to gather momentum.

“Monday’s Bank of Scotland’s PMI survey indicated that private sector activity in Scotland expanded for the 21st consecutive month in June whilst the Fraser of Allander, ITEM Club and PWC have all revised up their forecasts for growth this year.

“There can be no doubt that Scotland has the economic potential to be an independent country. With the full powers of independence we could do more to get people into work, ensure everyone in Scotland is able to benefit from our national wealth and give employers access to the skills they need to grow their business strengthening our economy and creating jobs.”

Cabinet Secretary for Training, Youth and Women’s Employment Angela Constance added: “While today’s figures show growth in Scotland’s economy, our ambition is to do better than to simply return to pre-recession levels of economic performance.

“It is encouraging that female employment continues to increase markedly with a higher employment rate than the rest of the UK.

“Although we continue to do better than the UK in terms of employment rates amongst young people and 90 per cent of school leavers are in positive destinations, our youth unemployment rate remains too high.

“This is why we support the principle outlined in the report last month by the Commission for Developing Scotland’s Young Workforce, that links between schools, colleges and employers can be strengthened, to be more aligned to student and business needs.”

Alexander urged to ‘come clean’ on assets share

As we confidently predicted yesterday (!) (see ‘Fantastical’), John Swinney was quick to counter Danny Alexander’s pronouncements on how an independent Scotland’s economy would shape up. Sadly the Holyrood Finance Secretary’s response made no reference to the forthcoming Eurovision Song Contest …

Finance Secretary John Swinney said any claims about Scotland’s finances from the UK Government must include details on Scotland’s share of UK assets worth nearly £1.3 trillion.

Mr Swinney said the Chief Secretary to the Treasury has recently admitted to the Scottish Parliament that Scotland will inherit a share of UK assets.

He said billions of pounds could be paid to an independent Scotland in cash as many of the assets paid for by Scottish tax-payers will be physically located in the rest of the UK.

Mr Swinney said: “Danny Alexander has said the UK Treasury is examining the finances of an independent Scotland.

“We already know Scotland is one of the wealthiest countries in the developed world and that over the past 5 years our public finances have been healthier than the UK’s to the tune of around £1,600 per person.

“To have a shred of credibility any Westminster analysis should also set out in detail the assets that will be due to Scotland in the event of a vote for independence in September.

“As part its campaign rhetoric we know the UK Government talks about Scotland’s share of the debt run up by successive Westminster Chancellors. It cannot be taken seriously if does not also talk about Scotland’s share of assets.”

“Scotland’s share of UK assets will be realised in a combination of ways – through physical assets, cash transfer and continued use of assets through shared service agreements.

“Assets located elsewhere in the UK will be included in negotiations, as Scotland has contributed to their value over a long period of time. For physical assets like these, the equitable outcome may be to provide Scotland with an appropriate cash share of their value.

“We note with interest preliminary analysis by academics suggesting that on defence alone Scotland may be entitled to draw upon a notional sum of nearly £5 billion for physical assets located elsewhere

“The apportionment of the UK national debt will be negotiated and agreed as part of the overall settlement on assets and liabilities.

“On any reasonable scenario, because national income per head is higher in Scotland than the UK, an independent Scotland will have a lower debt burden as a share of GDP than the UK.

“Both the Scottish and UK Governments have signed the Edinburgh Agreement which commits both governments to working together on matters of mutual interest, good communication and mutual respect.

“The two governments have also said they will work together constructively, whatever the result, so we can expect these matters to be worked out in that spirit of mutual respect and co-operation.”

BUCKS FIZZ: Not mentioned in Swinney speech

Scotland’s economy: glass half full or half empty?

Just how real is the economic recovery? For some, the future’s certainly looking brighter but for many more life continues to be a daily struggle …

The economic recovery in Scotland is now becoming more embedded, Scotland Office Minister David Mundell said yesterday. Commenting on the latest Scottish Chambers of Commerce business survey, Mr Mundell also stressed that there was further work to be done.

Mr Mundell said: “As today’s Scottish Chambers of Commerce survey and other recent business surveys confirm, optimism amongst Scottish businesses continues to grow. Key performance measures have reached levels not seen since 2007 which is leading to more and more Scottish businesses looking to recruit new staff.

“The manufacturing sector continues to show robust growth with investment at its highest level in six years and export orders increasing for five consecutive quarters.

“As part of the UK, Scotland is doing well. Whilst our economic recovery is becoming more embedded there is still much work to be done. The Budget set out the next stage of our long term economic plan, making it easier for Scottish businesses to invest, to take on new staff and excel on a global stage.”

With business confidence rising, The Scottish Chamber of Commerce sees a brighter economic future for Scotland, The business organisation released their Business Survey results for the first quarter of 2014 yesterday.

“The hard work and determination of Scottish businesses is yielding positive outcomes for the growth of Scotland’s economy. All the indicators in this survey point to sustained economic growth as key sectors increase investment to expand activity, boosted by higher levels of business optimism”, said Scottish Chamber of Commerce Chief Executive Liz Cameron.

“Investment intentions of Scottish businesses are encouraging with the manufacturing industry showing superb results with higher levels of investment than at any time in the past 6 years and robust growth in export orders shown by a consistent increase over 5 consecutive quarters. Whilst investment levels in the construction sector remain low, for only the second time in 5 years investment has not declined, and over 70% of businesses in the sector have either maintained or increased commercial and domestic orders compared with the last quarter. Promisingly, almost 90% of construction businesses surveyed expect employee numbers to remain the same or increase in the next 3 months and less than 14% reduced employment in the previous quarter.

“Higher levels of business optimism in construction, wholesale, retail and tourism is a positive signal for continued growth, as all sectors reported higher levels of confidence in Q1 2014 compared with the same quarter last year.

“However, despite these positive indicators, challenges still remain. The retail industry is expecting a decrease in profitability in 2014 which may point to stalled consumer confidence and seasonal patterns, but benefit may be drawn from positive growth in the tourism sector as confidence levels among hotels remained high and a rise in the use of conference facilities was also reported.

“The issue of skills shortages is becoming more prominent as businesses look to expand and invest. Businesses in the manufacturing sector are reporting difficulties in recruiting skilled & technical staff and the tourism sector are also reporting difficulties in recruiting managerial staff and chefs. It is vital that the organisations responsible for the development of skills provision, actively work with the business community to ensure employees are provided with the skills required to succeed.

“The buoyancy and optimism of Scottish businesses is to be commended but Governments in Scotland and the UK must facilitate opportunities for businesses to access affordable finance, particularly as cash flow remains a pertinent issue for businesses in construction and manufacturing. Alongside this, efforts to export internationally must be strengthened by policy makers to enable Scottish businesses to take advantage of global trade opportunities.”

However other senior figures believe the latest figures don’t tell the whole story and that much still needs be done – particularly for the lowest paid.

Responding to the latest Labour Market and GDP statistics Scottish Trades Union Congress (STUC) General Secretary Grahame Smith said: “These figures include some more positive news on the Scottish labour market but confirm that recovery remains very slow. As some focus on the level it is important to stress that the employment rate – a significantly more accurate measure of the health of the labour market – remains fully 3.5% below its pre-recession peak.

“Youth unemployment continues to stagnate at a high level with the unemployment rate for 16-24 year olds falling by only 0.1% in the year to December. We also know that far too many of the jobs that are being created are low paid and insecure whilst the number of those needing more hours at work to make a decent living remains far too high.

“STUC is not unduly concerned by the fact that Scottish GDP growth in the last quarter of 2013 was much lower than for the UK as a whole. We expect growth to catch up in the subsequent quarter. Far more concerning is the overall lack of evidence of economic rebalancing in Scotland and across the whole of the UK.”

And earlier this week The Trussell Trust, the UK’s largest foodbank network, reported that over 900,000 adults and children have received three days’ emergency food and support from Trussell Trust foodbanks in the last 12 months, a 163 per cent rise on the previous year’s numbers. The charity says that despite signs of economic recovery, the poorest have seen incomes squeezed even more than last year and more people are being referred to foodbanks than ever before.

The Trussell Trust’s Chairman, Chris Mould, said: ‘That 900,000 people have received three days’ food from a foodbank, close to triple the numbers helped last year, is shocking in 21st century Britain. But perhaps most worrying of all this figure is just the tip of the iceberg of UK food poverty, it doesn’t include those helped by other emergency food providers, those living in towns where there is no foodbank, people who are too ashamed to seek help or the large number of people who are only just coping by eating less and buying cheap food.

“In the last year we have seen things get worse, rather than better, for many people on low-incomes. It’s been extremely tough for a lot of people, with parents not eating properly in order to feed their children and more people than ever experiencing seemingly unfair and harsh benefits sanctions.

“Unless there is determined policy action to ensure that the benefits of national economic recovery reach people on low-incomes we won’t see life get better for the poorest anytime soon.

“A more thoughtful approach to the administration of the benefits regime and sanctions in particular, increasing the minimum wage, introducing the living wage and looking at other measures such as social tariffs for essentials like energy would help to address the problem of UK hunger.”

Encouraging signs as wages outstrip inflation

Brighter outlook for job seekers as unemployment falls again

There have been more indications that economic recovery is gathering pace with the publication of the latest figures by the Office of National Statistics yesterday.

Unemployment has dropped below 7% for the first time since the recession and employment has seen the biggest annual jump in a generation, the latest figures show.

Unemployment fell by 77,000 in the last 3 months, taking the unemployment rate to 6.9% for the first time since 2009.

In the largest annual rise in nearly 25 years, the number of people of people in a job rose by 691,000 – more than double the population of Newcastle – bringing the record number of people in work to 30.39 million.

Wages also rose on the year by 1.7%, against yesterday’s announcement that March’s inflation had dropped to 1.6%, and job vacancies rose again, up 108,000 over the past year bringing the number of vacancies in the UK economy to 611,000.

Minister for Employment Esther McVey said: “More young people are in work, more women are in work, wages are going up, and more and more businesses are hiring – and it’s a credit to them that Britain is working again.

“But there is still more to do – which is why I’d go even further and call on more employers to work with us to tap into the talent pool the UK offers.”

In Scotland, employment levels are at their highest since records began with 2,575,000 people over 16 now employed. The employment level is now 13,000 above its pre-recession peak of 2,562,000 in 2008.

National Statistics also published yesterday by the Scottish Government showed Gross Domestic Product (GDP) grew by 0.2 per cent over the fourth quarter of 2013 and increased by 1.6 per cent during 2013, the fastest annual growth since 2007.

The highest employment level record has been met by an increase in employment of 68,000 over the year, driven by an increase of 46,000 in the female employment level. The female rate of employment in Scotland is now 1.8 percentage points above the UK.

Scotland has again outperformed the UK across all headline labour market indicators, with a lower unemployment rate, higher employment rate and lower economic inactivity rate: details not missed by First Minister Alex Salmond.

Although the Scottish unemployment rate increased by 0.1 percentage points over the quarter, over the year it fell by 0.8 percentage points and now stands at 6.5 per cent compared to 6.9 per cent in the UK as a whole.

For the 17th consecutive month the claimant count decreased in Scotland with the number of people claiming Jobseekers Allowance falling by 2,400 over the month to March.

Welcoming the latest labour market figures, First Minister Alex Salmond said: “Today’s historic jobs figures show the Scottish Government’s policy of investing in infrastructure to boost the economy is making significant progress with employment levels at a record high. To put it in perspective, there are 285,000 more people in employment today than there were when the Scottish Parliament was established in 1999.

“Scotland is outperforming the UK across employment, unemployment and inactivity rates which goes to show even with the limited powers over the economy at our disposal we are improving our country’s economic health.

“Everyone aged between 16 and 19 is guaranteed an offer of a place in training or education through Opportunities for All and just this week we revealed we will create thousands of additional Modern Apprenticeship places, bringing our total target for MA’s to 30,000 every year by 2020 – double the level we inherited in 2007.

“This commitment to equipping our young people with the skills that they need will be further strengthened with the appointment of Angela Constance as Cabinet Secretary for Training, Youth and Female Employment.”

Carmichael welcomes income tax changes to help ‘hard working Scots’

Scottish Secretary Alistair Carmichael has welcomed changes to income tax that will see thousands of Scots workers taking more of their pay home. Mr Carmichael said Scotland is benefiting from being part of the ‘fastest growing economy on the world’.

From this weekend, 242,000 people in Scotland will be taken out of income tax altogether thanks to UK Government policy which sees the tax free personal allowance increase to £10,000 in 2014-15 – and that means that from overnight on Sunday an extra 19,000 Scots will no longer pay any income tax.

Scottish Secretary Alistair Carmichael said: “I am extremely proud to be part of a Government that has ensured that every hard working Scot will not pay any income tax on everything they earn up to £10,000. This is a key measure in our long term economic plan and one which every single Scot will be able to see and benefit from in their pay packet this month.

“Scotland is doing well because it’s part of the UK. We are benefiting from one of the fastest growing economies in the world which is creating jobs and ensuring certainty and security for families and individuals across the country.”

Over one million women in Scotland will directly benefit from this increase which comes as Scottish female employment levels reach near record highs.

This year’s Budget also confirmed that the personal allowance will increase again to £10,500 from next year helping even more Scottish families.

Across the UK, Government measures are cutting tax for over 26 million people. This includes taking over three million out of paying any income tax at all – 200,000 of these from this week.

The Sunday 6 April changes also mean that:

Someone working full-time on the October 2014 minimum wage (£6.50/h at 35hrs a week) will pay over 50 per cent less income tax in 2014-15 than a than someone on the national minimum wage in 2010.
Someone working for just under 30 hours a week on the October 2014 minimum wage will not pay any income tax at all.