Economic growth

The Scottish economy grew by 0.4 per cent in the second quarter of 2016, according to Gross Domestic Product statistics announced today.

The statistics also show that:

• In the second quarter of 2016, services in Scotland grew by 0.5%, production grew by 0.3%, and construction contracted by 1.9%.
• Compared to the same period last year (i.e. 2016 Q2 vs 2015 Q2), the Scottish economy grew by 0.7%.

Cabinet Secretary for the Economy, Jobs and Fair Work Keith Brown said:

“It is encouraging to see modest growth since the start of the year, which is the highest rate of quarterly growth since the start of 2015.

“These figures show that prior to the vote to leave the EU Scotland’s economy was growing.

“Despite concerns surrounding the EU referendum, the fundamentals of Scotland’s economy are strong and recent successes, such as Scotland securing more foreign development investment projects in 2015 than any other part of the UK outside London, are to be welcomed.

“The Bank of Scotland’s latest PMI showed Scotland’s private sector output expanding in September and our labour market now showed record quarterly growth employment over May-July 2016, and the unemployment rate is now below that of the UK.

“But in the months surrounding the EU referendum, there is no doubt that businesses faced challenging circumstances and damaging uncertainty. These are global issues and Scotland is not immune. We have constantly made clear our concerns that the vote will have a negative impact on investment and our economy. That is why protecting Scotland’s relationship with the EU, and continued membership of the single market is crucial – so we can build on some of these positive economic trends, rather than have this progress placed under serious threat.

“We are also acting now to support business. That is why we are establishing a £500 million Scottish Growth Fund, which will help companies access capital through guarantees and loans. And we are injecting some £100 million through a capital stimulus package to keep our economy moving and protect jobs. We are yet to see that action matched by the UK Government, and I urge them again to come forward with their own capital stimulus package as a matter of urgency.”