WE’RE IN AN ECONOMIC EMERGENCY

Jobless rate soars amid growing fears over virus impact on the economy — as First Minister admits:

SCOTLAND is in the grip of an ‘economic emergency’ that risks businesses collapsing and mass unemployment, Nicola Sturgeon has admitted. Unemployment rocketed by more than 16,000 in Scotland in the first three months of this year – which covers the early days of the lockdown restrictions.

The First Minister yesterday confirmed she will set out her first ‘concrete steps’ on the journey out of lockdown next week.

The changes are likely to include a return to work for some staff who are based outdoors.

But she admitted she will have to balance the need to get the economy moving again with ensuring she does not risk another increase in infection rates.

Miss Sturgeon also indicated she is likely to stop short of Boris Johnson’s message to people in England that they should return to work if they cannot work from home.

Business leaders yesterday pleaded for a clear plan to get the economy moving and

protect more firms from the risk of collapse. Acknowledging the economic threat, Miss Sturgeon said: ‘We know the essential public health measures we have had to take to deal with what is a public health emergency are, in themselves, creating an economic emergency and that will have an impact on people’s jobs, living standards and inequalities in our society.

‘Although the job retention scheme has offered some relief to many employers and employees, I am very aware many people will be deeply concerned about the future of their livelihoods.’

It came as Chancellor Rishi Sunak issued a grim warning there may be no ‘immediate bounceback’ from economic meltdown caused by Covid-19.

After the Office for Budget Responsibility and Bank of England warned the UK faces the worst recession in 300 years, he told the Lords economic affairs committee there was the threat of ‘scarring’ as people took time to try to get ‘back to normal’.

In other developments as the gloomy economic data was published:

n Scotland’s Covid-19 hospital death toll rose by 29, to 2,134, while people in hospital because of the virus increased by 20 to 1,447 but those in intensive care fell by four to 59;

n Miss Sturgeon rejected claims she was wrong to not inform the public of Scotland’s first coronavirus outbreak at a Nike conference in Edinburgh in February, amid revelations two Scots who were not delegates were among eight people to catch the virus;

n A damning report branded the crisis in care homes the ‘single greatest failure in devolved government since the creation of the Scottish parliament’;

n It was revealed that Scotland’s schools could return on August 11, under plans being considered by SNP ministers;

n A new ‘Pick For Britain’ drive was launched to encourage people, including those furloughed, to work for the fruit industries.

Official data published yesterday showed Scotland recorded the joint largest percentage point increase in unemployment in the UK in the three months to the end of March.

Scotland’s unemployment rate rose to 4.1 per cent in the period from January to the end of March, compared to 3.5 per cent in the previous three months.

It tied with the East Midlands, which also recorded a 0.6 percentage point increase in the unemployment rate.

The total number in employment fell by 13,945 to 2.66million, while unemployment grew 17 per cent by 16,160 to 112,652.

Miss Sturgeon acknowledged the figures demonstrate ‘the need to carefully get our economy moving again as quickly as we are able to do that safely’.

She announced a further £33million of funding to support people back to work, mainly focused on young people, disabled people and lone parents.

Miss Sturgeon plans to publish a ‘route map’ to easing lockdown tomorrow, with the first of the measures due to come into force at the end of next week.

Her proposals will focus on those who work outdoors, as well as other measures including the resumption of outdoor activities and the reopening of garden centres and recycling centres.

She said yesterday it would be ‘absurd’ to not acknowledge her concerns about the ‘economic or jobs impact of this crisis’.

But she added: ‘Equally, it is also really important that as we bring our economies into operation again, we do that in a way that doesn’t jeopardise the progress in the fight against the virus because, if we do that, then we will be back in lockdown again and our economy will shut down again and that will have an even bigger and more long-lasting impact on the economy.’

Tracy Black, director of CBI Scotland, said: ‘Businesses are looking for the Scottish Government’s route map out of lockdown, to provide some clarity on what the path to reopening the Scottish economy looks like.’

Scots Tory finance spokesman Donald Cameron said: ‘No one disputes this is a public health emergency first and foremost. But the economic consequences have been dire, too, and workers and businesses will be in real trouble without the right action from the SNP government.’

Top chefs yesterday warned Scotland’s hospitality industry faces a ‘tidal wave of business closures and mass redundancies’ if social distancing measures have to remain in place when bars and restaurants reopen.

A group including Nick Nairn, Martin Wishart and Tom Kitchin highlighted their fears in an open letter to the First Minister.

Comment – Page 16

‘An economic emergency’