Scotland faces timelag over recovery, says Kate Forbes
UNEMPLOYMENT could top four million as the coronavirus crisis grips the economy – hitting levels last seen more than 80 years ago, a report warns today.
The Learning and Work Institute said the “sharpest ever rises are taking unemployment to historic highs”.
Its 41-page report, reveals the “impact is uneven with young people and the least prosperous areas hardest hit”.
It adds: “Our analysis suggests unemployment could rise above 10 per cent in the second half of 2020, perhaps reaching levels last seen in 1938, following the Great Depression.
“This would mean in excess of four million people out of work.
“Even if the economic recovery is rapid, experience suggests that employment could take five years to recover.”
Holyrood’s Finance Secretary has admitted the economy in Scotland could recover at a slower rate than in England due to differences in when lockdown was eased.
Kate Forbes said it could be “worse for slightly longer” north of the Border as some sectors get back to the work after their counterparts down south.
But she insisted any differences could “balance themselves out” if the public has more confidence in Scotland’s routemap out of lockdown than with Boris Johnson’s plan.
Some sectors of the economy in England such as construction continued during the height of the pandemic, while the housing market has already resumed. Appearing on BBC Scotland’s Podlitical podcast yesterday, Forbes was asked if she was worried the recovery could take longer in Scotland as “things are moving slower”.
She said: “It certainly could be worse for slightly longer than in England.
“Shops [in England] are able to reopen, the housing market is slightly ahead and some construction continued during the pandemic.
“So yes, there is a risk of the economic impact being disproportionate.”
But she added: “If customers in England are not confident that things have opened at the right time, they won’t return.
“Ultimately, if there is a more significant return of customers [in Scotland], and businesses get back trading quicker when they are allowed to do so, it might event itself out.”
Experts have previously said Britain should be braced for the worst recession for 300 years, since the Great Frost of 1709 hammered output.
Unions called on the Government to act to avoid the jobs crisis deepening.
Industry chiefs and some Tory MPs believe easing the two-metre social-distancing rule is key to reviving the economy.
Some businesses warn they will be unable to make a profit or even reopen at all if the rule remains.