More than 5,000 workers in Aberdeen are at risk of losing their jobs, council leaders have claimed as local lockdown restrictions are continued.

First Minister Nicolal Sturgeon announced £1 million is being made available to help businesses affected by the lockdown, as she insisted it is not yet safe to ease restrictions in the city.

Pubs, cafes and restaurants in Aberdeen were ordered to close two weeks ago after a spike in coronavirus cases in the city, with people told not to visit other people's homes or travel more than five miles for leisure.

NHS Grampian confirmed there are now 226 cases of coronavirus arising from a cluster linked to bars in the city.

Speaking at the Scottish Government's coronavirus briefing on Wednesday, the First Minister said while the situation in Aberdeen is "undoubtedly improving" she is not "in a position to say that this outbreak is over or completely under control".

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She said she hopes to be able to begin lifting restrictions from next Wednesday, starting with "lower risk premises" such as non-licensed cafes.

Jenny Laing and Douglas Lumsden, the co-leaders of Aberdeen City Council, said restrictions should be lifted from Saturday.

Mr Lumsden said: "The First Minister must be aware of the harm extending the lockdown is doing to both our citizens and our economy."

He claimed the area had been "disproportionately affected by Covid-19", and notifications to the Scottish Government's Pace (Partnership Action for Continuing Employment) scheme shows 5,100 workers across 70 companies are now at risk of redundancy.

Ms Laing said a meeting with Scottish Government officials on Tuesday had heard from the incident management team that "they believed the situation is now under adequate control" for premises to start to open up again from Saturday, subject to mitigating measures being put in place and site-specific assessments.

She added: "Covid-19 has already had a significant impact on our local economy and continuing with the current restrictions is only going to make a bad economic situation even worse.

"The continued closure of restaurants, cafes and bars is hurting not just those businesses directly affected but it is having a serious impact on a number of other sectors, including retail which has reported a 60% drop in footfall since the restrictions were introduced.

"The perception and reputation of Aberdeen is being damaged the longer this goes on."

Liz Cameron, chief executive of Scottish Chambers of Commerce, said the future of many businesses in the city is now "on a knife edge".

She added: "The £1 million emergency funding announced is a welcome first line of support and it must be deployed as quickly as possible when the fund opens next week.

"However this will not in itself be enough to stave off the worst and more must be done to support these businesses."

Ms Sturgeon acknowledged it is "disappointing" the restrictions cannot yet be lifted, but she warned "moving too quickly" could risk the progress that has been made on tackling the virus.

She stressed measures to tackle the outbreak in the area are having an impact, with "some evidence that the original cluster linked with bars and nightlife is being contained".

But she added: "We are also continuing to see a number of individual cases and other smaller clusters in the city.

"That is not necessarily unusual for an outbreak of this scale but it is something we must monitor very carefully."

A business representative has said the move to keep Aberdeen in lockdown for a further week is "disappointing and surprising", and that the £1m back-up money would not stretch far across the business community.

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Responding to the announcement made by the Scottish Government today that the local lockdown in Aberdeen will be extended by another week, Russell Borthwick, chief executive of Aberdeen and Grampian Chamber of Commerce, said: “The chamber has been engaging with business communities and senior figures in government at all levels to find a way forward which balances the public health priority with the economic damage caused by lockdown, a need which is reinforced by today’s unheard of GDP figures.

“Despite a lot of hard work by us and others to make the case, we are very disappointed and surprised that the full lockdown measures will remain in place and fully back the stance of Aberdeen City Council that they should not continue beyond this weekend.

“On the basis of reducing levels of infection, we believed we should have seen a phased release of the lockdown restrictions starting today and working towards a full reopening of all affected venues over the next week to 10 days or earlier.

“We have been impressed by the further efforts of venues in working together to ensure lessons are learned and practices are adjusted."

He said: "It was welcome to see the Scottish Government respond to our request with a £1m local grant scheme to support affected businesses but in reality, the maximum grant per business of £1,500 won’t make a meaningful difference to the survival or not of venues forced to close for what now looks like a period of up to a month or longer.

“It’s also important that UK Government responds positively to our ‘ask’ around flexibility in the job retention scheme.

“We have already seen business failures and now fear more will follow, with the job losses that will accompany this. The chamber will continue to be a vocal advocate for the business community, pushing hard for measures to ensure the future viability and vibrancy of our business community and our region in the weeks ahead.’’

While no coronavirus deaths have been reported in Scotland in the last 24 hours, the death total has increased by one to 2,492 due to a previous fatality being included in the figures.

The death was registered on April 21 but not included in original figures due to a delay.

A total of 19,457 people have tested positive for the virus in Scotland, up 50 from 19,407 the day before.

Scotland has entered recession, with GDP almost a fifth lower than it was before the country entered lockdown, according to official figures.

The latest economic data from the Scottish Government shows the country has now experienced two consecutive quarters of negative economic growth - with performance down 2.5% in the first three months of the year and 19.7% in the second quarter.

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While provisional monthly figures show some improvement in June, GDP "remains 17.6% below the level in February, prior to the lockdown measures which were introduced in March".

The report estimates GDP increased by 5.7% in June compared with the previous month, noting there has been a "stronger and more widespread pick-up" in economic activity than in May, with output now said to be increasing "in all the main industry sectors".

Liz Cameron, chief executive of the Scottish Chambers of Commerce, said the country is now in "deep recession".

She said: "The collapse in Scotland's GDP in the second quarter sets alarm bells ringing even if the fall was expected.

"The 19.7% decline from April to June makes Scotland's and the UK's economies among the worst performing in Europe.

"These figures confirm the Scottish economy is in deep recession and intervention is required now to prevent real and lasting damage to the jobs market."

Ms Cameron called on UK Chancellor Rishi Sunak to act, saying he should "make an immediate reduction in employers' national insurance contributions".

She added: "Without rapid intervention in the form of fiscal stimulus packages as well as cost cutting efforts such as rates holidays, we fear that the Scotland's economic landscape may never recover to previous levels."

National Express said its chief is to leave the coach operator early in order to take his new role as head of housebuilding giant Persimmon.

Shares in National Express slid after it said group chief executive officer Dean Finch will now leave the company at the end of August.

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National Express said its current chief financial officer Chris Davies will take over as interim chief executive officer from the start of September.

The transport firm said its search for a new permanent chief is "progressing well", with both internal and external candidates being considered for the role.

Shares were 5.4% lower at 134p.

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