Fiona Hyslop

GDP fell as restrictions on economic activity continued at the start of the month and were later extended across Scotland after Christmas.

The latest result follows a revised fall of 1.5% in November. Output remains 7.2% below the level in February, prior to the direct impacts of the COVID-19 pandemic.

In December there was growth of 0.3% overall in the services sector, but further falls in the subsectors which are directly impacted by the restrictions in Protection Levels 1 to 4 during November and December.

Output in the production sector decreased by 1.8% overall in December, with falls in three of the four subsectors. This includes the first fall in manufacturing output since April, with a drop of 2.4%. Construction sector output is also estimated to have fallen by 2.4%, which is also the first fall since April for this sector.

Using the experimental monthly statistics for Quarter 4 as a whole (October to December), GDP is provisionally estimated to have increased by 1.6% compared to Quarter 3, slowing significantly from the 15.8% increase in Quarter 3. In annual terms, comparing 2020 as a whole to 2019, GDP is provisionally estimated to have fallen by 10.6%.

Commenting on the statistics, economy secretary Fiona Hyslop, said: “Our economy has been badly hit by the coronavirus (COVID-19) pandemic. Both Scotland and UK have seen record falls in GDP over 2020 but that is not surprising as large parts of the economy were required to close to protect lives.

“The most recent data shows Scotland’s economy increased by 1.6% in the final quarter of last year, compared to 1.0% across the UK. However, combined with the huge economic uncertainty caused by Brexit, this remains an extremely tumultuous time for the economy and jobs.

“We will continue to press the UK Government to ensure key support packages, such as the furlough scheme and VAT relief, are kept in place for as long as is needed.”

She added: “As a responsible Government, we are doing all we can to protect Scotland’s economy and ensure that as many people as possible keep their jobs. Our package of support to businesses now totals over £3 billion, and our support for economic recovery worth more than £1 billion. On top of this we have committed to the extend non-domestic rates relief for the whole of next year, worth more than £700 million.

“We are using all the powers we have to rebuild a stronger, more resilient and sustainable economy for Scotland – with a laser focus on creating new, good, green jobs. As part of that, our £60 million Young Person’s Guarantee will ensure every young person has access to a job, education or training and we have also announced plans to increase support for older workers to re-skill in growth areas, such as low carbon industries.”