Scotland “crawls” out of recession
22 Apr 10
Scotland’s economy shrank markedly in 2009 but it is, only just, emerging from recession, according to official statistics
Figures released by the Office of National Statistics show that gross domestic product in Scotland in 2009 was down 4.8 per cent on the previous year, but the last quarter of 2009 showed the economy returning to growth, at just 0.2 per cent.
In the year to end-December 2009, the Scottish service sector fell by 3.6 per cent, the production sector declined by 8.9 per cent and the construction sector fell by 10.8 per cent.
In the fourth quarter of 2009, the service sector grew by 0.2 per cent, the production sector grew by 0.8 per cent and the construction sector fell by 2.8 per cent.
CBI Scotland's assistant director, David Lonsdale, said: "This latest data marks a welcome though decidedly modest exit from the recession in the final quarter of last year, and demonstrates just how fragile the recovery is. For many firms and individuals it will not feel like recovery for some time yet, reinforcing the need for supportive business and economic policies to be at the very heart of the agendas being put forward by all of the political parties which aspire to government."
Dougie Adams, senior economic advisor to the Ernst & Young Scottish ITEM Club, commented: “Scotland is crawling out of recession. The latest data shows that the Scottish economy shrank marginally more than the UK over the course of the recession, with a 6.1 per cent fall in output.
“While a wide range of sectors in Scotland suffered smaller falls in output over the recession than their UK peers, including manufacturing, retailing and hotels, the Scottish economy was hit hard by much bigger contractions in its key financial and business services sectors. Both of these sectors shrank by around 10 per cent over the recession.”
Adams said that much now hangs on how well the large business services sector can respond to the better demand conditions that are slowly emerging. He added: “Encouragingly, its growth of 0.7 per cent in the final quarter of 2009 kept pace with the sector in the UK as whole.
“With the caveat that too much emphasis should not be put on one quarter of data, the news in manufacturing was positive too. After a fall of 11.5 per cent over the recession, compared with 14 per cent for UK manufacturing, Scotland's manufacturers again outperformed over the first quarter of recovery, with output up 1.2 per cent.”