Scotland’s GDP increases in May but remains well below pre-lockdown levels
Scotland’s GDP increased slightly in May but was still well below where it was before lockdown, according to new data from Scotland’s chief statistician.
GDP went up by 1.5 per cent in May, after falls of 5.5 per cent in March and 18.9 per cent in April, but it remained 22.1 per cent below where it was in February.
On a rolling quarterly basis, comparing the three months March-May to December-February, GDP fell by 17.3 per cent.
According to the statistics, output fell in nearly every industry during April, but the results for May were more mixed, with some sectors suffering further drops while other showed signs of recovery.
Industries with the largest falls in output over the latest three months covered by the data were those which have been required to close or where working at home is not possible.
Retail and wholesale, transport, manufacturing and construction are thought to have seen a pick-up in activity in May as companies and the public adapted to physical distancing, but parts of the services sector such as accommodation and food, and arts, culture and recreation, experienced further falls in output.
The data is the second release of new monthly experimental GDP statistics for Scotland, which are being produced by the Scottish Government to help track the economic impact of COVID-19.
They are classed as experimental statistics rather than national statistics because they are being released while still at a provisional stage and may be less accurate than the usual quarterly data.
Commenting on the figures, economy secretary Fiona Hyslop said: “Although there was a slight rise in GDP in May, these figures once again confirm the serious impact the coronavirus (COVID-19) pandemic is having on the economy across the UK.
“We are determined to do everything in our power to support economic recovery and protect people’s jobs and livelihoods throughout this crisis.
“Since May lockdown restrictions in Scotland have been eased on several business sectors including manufacturing, construction and retail, and the Scottish Government has introduced a series of measures to help stimulate the recovery.
“We are implementing a £230 million investment package to create jobs in construction, low carbon schemes, digitisation and business support and last week we unveiled a £38 million for high growth companies.
“Yesterday, I outlined that the further £100 million for employment support would provide additional assistance to move into work or retrain.
“This would be done through a new national retraining scheme, more funding to provide immediate assistance and advice if people are made redundant, and at least £50 million of that funding set aside to help young people get into work.
“However, we want to do more and continue to press the UK Government for the additional financial powers, or more funding, that would enable us to tailor a bespoke Scottish response to the crisis.
“It is concerning that despite the challenges facing our economy, the UK Government refuses to extend the EU transition period, a decision that will burden business with increased costs and more bureaucracy from 1 January.”
Scottish secretary Alister Jack said: “There is a long way to go to get our economy back on track after the coronavirus pandemic.
“The UK Government has and will continue to support Scotland’s economy.
“That includes supporting almost 900,000 jobs through pioneering furlough and self-employed schemes, business loans, help to get young people into jobs, and a VAT cut plus the Eat Out scheme to get our tourism and hospitality industries back on their feet.
“We are also providing an additional £4.6 billion through the Barnett formula for the devolved administration at Holyrood.
“The UK Government will continue to do all it can to drive our economic recovery, and we hope the Scottish Government will work with us on that.”
Dr Liz Cameron, chief executive of the Scottish Chambers of Commerce, said: “The GDP stats for the month of May from the Scottish Government show a modest rise in economic activity.
“However, the disparity with pre-lockdown figures clearly demonstrate the harsh reality facing companies across Scotland who are faced with the challenge of stimulating demand and managing new ways of operating.
“The Scottish and UK governments must work with business to accelerate investment to stimulate demand and protect jobs as well as providing long-term targeted support for the most affected sectors.”