Jobless total hits 12-year high – as Scotland enters recession

UNEMPLOYMENT across the UK has soared to its highest level since Labour came to power 12 years ago, according to the latest figures published yesterday.

The number of people looking for work jumped by 177,000 in the three months to February to reach 2.1 million – the biggest quarterly rise since 1991.

The latest round of gloomy unemployment statistics came as it emerged that Scotland had officially entered recession, with GDP falling for two successive quarters at the end of last year.

Scotland's gross domestic product fell by 1.7 per cent in the final quarter of 2008, following a 0.8 per cent drop in the previous quarter.

But there were some anomalies in the GDP figures, with the financial services sector in Scotland reporting growth of 2.2 per cent – at a time when HBOS was disappearing and the RBS was being partially nationalised.

However, as well as entering recession officially yesterday, Scotland also experienced another rise in unemployment. The number of people out of work in the three months to February, including those not eligible for benefit, rose by 5,000 to 143,000.

And the number of people claiming jobseeker's allowance saw an even larger rise, surging by 6,000 to 119,400 in the month of March, up 50,600 on March last year. The latest rise comes on top of increases in the previous monthly figures in March.

But there was slightly better news for Scotland on unemployment, at least in comparison to the rest of the country.

Scotland's unemployment rate of 5.4 per cent is the third lowest of any region in the country, with only the south-east (5 per cent) and the south-west (5.2 per cent) doing better.

Scotland's rate is particularly low when compared to regions like the north-east and the north-west of England, both of which now have unemployment rates of more than 8 per cent, and the UK average of 6.7 per cent.

Ministers and business leaders in London and Edinburgh expressed their disappointment that Scotland had at last followed the rest of the UK into recession and insisted more had to be done to save the country from further economic decline.

Finance secretary John Swinney said: "These figures highlight the scale of the challenge we all face, and mean Scotland is now officially in recession. Although our labour market remains substantially stronger than the UK as a whole, further figures published today show unemployment is rising."

Action being taken by the Scottish Government through its economic recovery programme was supporting thousands of jobs, he said.

Scottish Secretary Jim Murphy said the figures showed the "real effect" of the current global economic conditions.

"We know the effect job losses have on families and that is why we are doing everything we can to get real help to people losing their jobs," he said.

The Scottish employment rate stands at 75.4 per cent and continues to be above that of the wider UK and almost all countries within the EU.

However, CBI Scotland assistant director David Lonsdale said the economy had worsened since the period covered by yesterday's figures.

"With the wider UK economy firmly in the doldrums, the likelihood is that Scotland's economy won't perk up until well into next year," he said.

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HOW DEPRESSING FIGURES ADD UP

143,000
the number of people out of work in the three months to February in Scotland.

119,400
the number of people claiming jobseeker's allowance in Scotland in March.

5.4 per cent
the current rate of unemployment in Scotland.

6.7 per cent
the rate of unemployment in the UK as a whole.

1.7 per cent
the fall in Scotland's GDP for the final quarter of 2008.

2.2 per cent
the rise in GDP for the financial services sector in Scotland in the last quarter of 2008, despite the loss of HBOS and the partial nationalisation of RBS.