Scottish economy flatlined in first quarter

Government figures released today show that during the first three months of the year services in Scotland grew by 0.4 per cent, but manufacturing contracted by 1.2 per cent and construction by 1.5 per cent.

On an annual basis, Scotland’s economy grew by 0.6%, compared with UK growth of 2%.

In a report released last week, accountancy firm PwC downgraded its growth forecasts for Scotland’s economy.

House prices were predicted to fall in Scotland as an economic slowdown takes hold, but the economy will not fall into a recession.

Andy Willox, the FSB’s Scottish policy convenor, said: “These pre-referendum figures demonstrate that the Scottish economy was underperforming before the vote. While a decline in unemployment is good news, there’s a worrying gap between the UK and Scottish jobless rates.

“Business surveys and feedback suggest that some investment plans and deals have been put on hold as a consequence of recent economic and political turbulence.

“As Number 10 and Bute House draw up plans to restore business confidence, they must think about community firms as well as the stock market. They must shelve proposals that would give business owners headaches and think about local infrastructure as well as large national projects.”