Monthly economic brief: February 2023

Output

Economic output fell in November as the underlying pace of growth continued to stall.

• The Scottish economy contracted by 0.1% in November, and growth was flat over the three months to November having fallen by 0.1% in the third quarter and was flat in the second quarter (0.0%).^[1]
• The weak performance over this period is broadly consistent with the pattern of growth in the UK as a whole (-0.3% in the three months to November) and reflects a stalling in growth as the economy faced increasing and elevated inflationary pressures over the course of the year.

• The pace of growth was on a downward trend across sectors during 2022 and services sector output fell 0.1% in the three months to November. This was in part driven by a 0.7% fall in consumer facing services, despite anecdotal evidence at a UK level that the World Cup had helped generate some business activity in food and beverage services activities in November.
• Construction output also fell in the three months to November (-0.2%), while Production output grew 0.6% over the period, with growth in the sector driven by electricity and gas output (3.5%). Manufacturing output however fell 0.1% over the three months and there are indications that supply side challenges continue to impact the production sector, though to a much lesser extent than earlier in the year.