State of the Nation: Scotland teeters on brink of return to recession

Scotland’s economy could be teetering on the brink of a second recession in 12 months, according to SCDI’s latest State of the Nation briefing for February 2021.

Scottish GDP decreased by 1.4% in November after 6 months of growth, with strong indications of another poor month in December. Scottish retail sales in December were the worst on record. The Purchasing Managers’ Index showed a further contraction in private sector output.

The official UK jobless rate is 5%, but Andrew Bailey, Governor of the Bank of England, has suggested that the true rate is likely to be closer to 6.5%. The Scottish Fiscal Commission forecasts an increase to 7.6% unemployment by the middle of the year.

Key points

  • Scotland’s economy 7.1% smaller than before pandemic
  • Scottish GDP decreased by 1.4% in November raising the prospect of two recessions in 2020
  • Glasgow expected to be hardest hit city, while Edinburgh anticipated to be most resilient
  • Worst December on record for retailers
  • 1 in 5 workers worried about losing their jobs as official projections suggest unemployment could increase to 7.6% in 2021
  • 7% of all Scottish workers furloughed in October

Download February’s State of the Nation briefing below for all the latest data and forecasts in one place.

Downloads

State of the Nation / February

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State of the Nation / January

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State of the Nation / December

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