Sturgeon must produce the goods today or business may never recover

ASLEW of statistics published this week demonstrates that the lockdown has wrought devastation on the Scottish economy and that huge job losses are just around the corner.

Experts forecast a recession which would make the financial crash look like a wet weekend. But if we help Scottish local economies – and the smaller firms on which they rely – get back on their feet quickly, then we can avoid the worst predictions.

We must get up and running so that businesses that survived the lockdown do not falter just as restrictions are being eased.

Scotland lost a quarter of its economic output since March, according to Scottish Government statistics.

Despite the scale of the Chancellor’s furlough scheme, figures out this week show the unemployment rate in Scotland has risen higher than the other UK nations.

This should not surprise us. Ministers in Edinburgh and London shut down large parts of our economy to reduce the spread of coronavirus. Policymakers understood lockdown meant job losses and business failures, but the judgment was that this was necessary to save lives.

Chancellor Rishi Sunak and Scottish Finance Secretary Kate Forbes knew they were trying to salvage as many businesses as possible from circumstances way beyond the control of the local shop, restaurant or small hotel.

They have covered employees’ wages and taken care of overheads to try to make sure as many operators as possible survive. At every turn, the Federation of Small Businesses has been making the case for extensions and expansions, trying to ensure loopholes for support do not become nooses for local businesses.

There is no doubt, however, that many billions of taxpayer pounds have been committed to helping as many small and medium-sized businesses and self-employed individuals come through this crisis as possible. That is because those in charge understand that these operators account for 1.2million Scottish jobs – more than half of the private sector total – as well as more than 40 per cent of private turnover.

Yet to avoid a jobs crisis, the Chancellor may yet be required to reduce the cost of employment by cutting employers’ national insurance contributions. It also looks likely further support might be needed for tourism and hospitality. So when the First Minister stands up today, what could she announce that would give smaller firms a shot in the arm? How could the Scottish Government kick-start the recovery, rather than just ease the lockdown?

To a certain extent, it is all about timing. Half of Scotland’s smaller businesses closed their doors during this crisis.

Those that still cannot trade want to know when they will be able to and what they should do to keep staff and customers safe.

Lots of business owners have limited cash reserves and some are worried if lockdown goes on too long they will have insufficient fuel in the tank to get going again. A third of closed businesses fear they will never re-open.

For many firms it is not just a case of turning the key in the door and switching on the lights. Firms will need time (and advice) to organise their operations and make alterations to their premises before they can trade again.

PERHAPS critically, business owners will need to open discussions with staff about returning to work and any changes to work patterns. That is why we are worried by the suggestion some children will only return to school a couple of days a week well into the autumn – making life incredibly difficult for working parents.

Today we will likely hear about when many local shops will reopen. Not only do we want to see cash found to help firms and high streets make adaptations so they are safe and hospitable, we are looking for a national push to encourage consumers to shop local when the time is right.

In addition, we are looking for a new safety net for local businesses as they play their part in efforts to control the virus. A targeted grant should be provided for firms that have to shut up shop because of contact with the disease.

A jobs and economic crisis may well be upon us soon. The depth of the downturn likely depends on the decisions made now.