SCOTLAND’S employment rate rose slightly in the last quarter but still lags behind UK and pre-pandemic levels.

Office for National Statistics labour market data showed the proportion of 16 to 64 year olds in Scotland nudged up 0.3 per centage points to 74.3 per cent from June to August.

That was 1.1 points down on the last quarter before the Covid pandemic struck (December 2019 to February 2020), and 1 point below the current UK employment rate of 75.3%.

Scotland’s unemployment rate was unchanged quarter-on-quarter at 4.4%, slightly lower than the UK rate of 4.5%, but still 0.6 points higher than before the pandemic.

The year-on-year change for Scotland saw employment increase by 0.2 percentage points and unemployment fall by 0.1.

Other experimental data showed 161,700 people in Scotland claimed jobseeker’s allowance or universal credit principally because of unemployment last month, down 4,800  on August.

However the claimant count was still 48,600, or 43%, higher than pre-pandemic March 2020.

HMRC pay data put the media monthly pay for payrolled employees at £2,009 in Scotland, up 7.4% on February 2020, compared to 7.5% for the UK as a whole over the same period.

Other estimates for Scotland suggested there were 2,382,000 payrolled employees in September, up 73,000 or 3.1% on the same month in 2020.

However this was still 12,000, or 0.5 percentage points, lower than in February 2020, whereas the number of payroll employees for the UK as a whole has risen 0.4 points. 

SNP employment minister Richard Lochhead said the UK Government needed to change immigration controls to help Scotland’s employers fill vacancies.

He said: “For June-August 2021, Scotland’s employment rate estimate increased over the quarter to 74.3% and the unemployment rate estimate remained the same over the quarter at 4.4%.

“Separate HMRC early estimates, also published this morning, show 15,000 more payrolled employees in September than August 2021, however this is 12,000 fewer payrolled employees compared with February 2020, which reflects our gradual ongoing economic recovery from the pandemic.

“The Scottish Government will continue to do all we can to support employees and employers and we are carefully monitoring any impact on employment resulting from the withdrawal of the UK Government’s Job Retention Scheme.

“In 2021/22 we will invest more than £1 billion to create jobs and ensure people have the skills needed to meet the economic opportunities of the future.

“The current shortages and challenges we are seeing in some sectors cannot be resolved through the Scottish Government’s budget alone and the UK Government needs to take action on immigration policy, over which we have no control.

“Where we can intervene we will. For example, funding a marketing campaign to boost recruitment in the hospitality industry and investing up to £836,000 to create up to 1,800 additional college training places in adult social care.” 

Scottish Secretary Alister Jack said: “The UK Government’s priority is getting people back into work - so it is pleasing to see the latest employment figures once again show positive signs of recovery for Scotland with more people returning to employment.

“Our Plan for Jobs is helping people secure well-paid, skilled employment as we build back better from the pandemic, and we will continue to do all we can to see our economy flourish again.”

Dr Stuart McIntyre, Head of Research at the Fraser of Allander Institute, noted today’s figures were the last before the effects of ending furlough kicked in. 

He said: “The recovery in demand in the economy as we emerge from the pandemic, coupled with a number of supply side challenges, is producing a labour market that on the face of it looks fairly robust. That said, three key factors need to be borne in mind.

“First, the recovery at this point is mostly driven by a rebound in consumer spending as the economy has reopened. This may go into reverse if public health restrictions are strengthened, and consumer confidence dips.

“Second, supply chain disruptions may be leading to increased demand for workers in the short-run, but if these factors become more permanent we may see lower employment as the productive capacity of the economy shrinks.

“Third, robust headline labour market data do not in themselves reassure us about conditions in the economy. We also need to monitor changes in inflation adjusted wages, and the type and conditions of work available.”