Pay fears as jobs tally hits a record high

MORE than three-quarters of Scots are now in work after the employment rate hit a record high.

But concerns have been raised that the figures have been boosted by workers taking less secure, low-paid jobs.

A total of 75.2 per cent of people were in a job in the three months to the end of June, figures published yesterday show.

It is the highest ever employment rate after the number of people in work increased to 2.65million, in the second quarter of the year. Unemployment fell by 12,000 and now stands at 3.9 per cent.

Separate figures published yesterday show that average weekly earnings fell by 0.5 per cent in real terms across the UK in the final quarter of the year.

Scottish Trades Union Congress (STUC) general secretary Grahame Smith said: ‘With unemployment at record lows, you would expect wages to rise as workers gain greater bargaining power in the labour market.

‘This clearly is not the case, as real average weekly earnings have fallen across the UK by 0.5 per cent in the three months to June.

‘Serious questions about the health of our labour market continue, which underlines the economic illiteracy of Government policies that hold down pay.

‘We require a greater focus from Government on improving the quality of work, while stimulating the economy. We need an immediate end to the public sector pay cap and a significant increase in real wages.

‘The Scottish Government must use its tax and borrowing powers to invest in our public services and economic infrastructure.’

Office for National Statistics figures show the employment rate north of the Border rose by 30,000, to 2,650,000, in the three months to June. This is 22,000 higher than the same time last year. Unemployment fell by 12,000 in the quarter, to 107,000, and is 34,000 lower than the same quarter last year.

There was also an increase in the number of people defined as ‘economically active’ – in work or looking for a job. Over the three months, the number of such people increased by 18,000, to 2.76million.

Hugh Aitken, director of business body CBI Scotland, said: ‘Scotland now sits alongside London in having the fastest quarter-onquarter increase in employment in the UK.

‘While this is encouraging, filling highskilled vacancies is a persistent problem and Scottish businesses will find it increasingly difficult to access enough people as the number of people looking for work falls.

‘We also face a challenge to boost productivity in order to achieve the rising wages and improved living standards we all want to see.’

Although average weekly earnings across the UK grew by 2.1 per cent in the three months to June, that is still below the 2.6 per cent rate of inflation – meaning a real-terms reduction of 0.5 per cent.

The average weekly wage across the UK now stands at £606, equivalent to £31,512 a year. In Scotland, wages are much lower, at £580 a week, or £30,160 a year.

Scottish Labour’s economy spokesman Jackie Baillie said: ‘Wages are failing to grow and are continually outstripped by inflation, so even those in work are worse off.’

Economy Secretary Keith Brown said: ‘This is a further vote of confidence in our economy, coming after GDP figures showing Scotland’s growth rate was four times faster than that of the UK over the last quarter, and recent reports of accelerating growth across the private sector.’

Scottish Secretary David Mundell said: ‘The UK Government will continue to work to strengthen Scotland’s economy.’