Scotland’s unemployment rate falls by 0.2% in first three months of 2021

Scotland’s unemployment rate fell slightly from January to March 2021, according to the latest figures released by the Office for National Statistics (ONS).

Scotland's unemployment rate falls by 0.2% in first three months of 2021

The data has also revealed that the percentage of people looking for work in Scotland during this period dropped by 0.2% to 4.3%.

The ONS said that the number of people in work aged 16-64 rose by 0.7% to 74.4% during the same quarter.

As a whole, Scotland’s unemployment is rate is lower than the UK-wide of 4.8% for those aged 16-64.

There were 2.560 million people aged 16-64 in employment between January and March in Scotland, while 116,000 people in that age range were unemployed.

The drop in the unemployment rate across the UK has indicated that a combination of the furlough scheme and improved business confidence is providing support to UK jobs.

ONS Pay as You Earn Real Time Information data has indicated that the number of UK paid employees in April was up 97,000 from March and points to a pick-up in hiring.  Employment rose by 84,000 in the three months to March.

However, the number of payroll employees remains 772,000 below pre-pandemic levels. Since February 2020, the largest falls in payrolled employment have been in the hospitality sector, among those aged under 25 years, and those living in London.

Howard Archer, chief economic advisor to economic forecaster the EY ITEM Club, said: “The latest labour market data show improvement and are robust overall, indicating that a combination of the furlough scheme and improved business confidence is providing support to jobs.

“The repeated extensions of the furlough scheme are having a significant impact in limiting job losses. The labour market would likely have come under appreciable pressure at the start of 2021 from the renewed lockdown, which resulted in the economy contracting by 1.5% quarter-on-quarter.”

He added: “Nevertheless, the EY ITEM Club still expects there to be a modest rise in unemployment when the furlough scheme ends in September, while the unemployment rate could also be pushed up by previously discouraged people returning to the labour market and looking for a job.

“Given the current resilience of the labour market, the extension of the furlough scheme to September and the prospect of decent recovery developing from the second quarter – supported by the rapid rolling out of the COVID-19 vaccines – the EY ITEM Club expects the peak in the unemployment rate to be limited to 5.7%. Furthermore, there is a real and growing possibility that the peak unemployment rate may not exceed 5.5%.”

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