Coronavirus (COVID-19): measures to mitigate the labour market impacts - report

Foreword

The Coronavirus (COVID-19) pandemic quickly evolved from a health crisis to also being an economic crisis, with sharp rises in unemployment experienced across the global economy as governments halted economic activity. The unprecedented events of the past few months are expected to have more lasting economic implications as countries look to restart their economy and rebuild.

Given the pace of events, the need to act fast in responding to the current economic challenges posed by the pandemic has never been more important.

Since its creation over two and a half years ago the Enterprise and Skills Strategic Board has been focused on driving greater collaboration and action across the enterprise and skills system to tackle some of the longer-term challenges facing the Scottish economy, such as raising its productivity performance. However, its immediate focus in these past few months has pivoted to the more immediate challenges the Scottish economy faces and how the enterprise and skills agencies can support the recovery.

The Deputy First Minister has made clear that the status quo is not an option as our skills and business support needs to change to meet the scale of the challenges we face. Therefore, he asked that a sub-group of the Strategic Board be set up to consider what practical actions can be implemented quickly to not only help keep people in employment, but also support those either facing the threat of redundancy or who have already lost their job. In addition, specific attention should focus on how we can help support young people and those who are about to enter the labour market for the first time.

The sub-group has focused on practical actions which can be taken forward immediately to mitigate the labour market impacts of the crisis. It has worked closely with the Advisory Group on Economic Recovery and has put forward a range of ideas for how best to accelerate the recovery. A key part will be to ensure the enterprise and skills system works together with business in delivering a truly integrated package of support considering the challenges the Scottish economy faces.

This report highlights a range of recommendations which attempt to do just that. The focus has rightly been on both the labour demand side in terms of how we can support Scottish businesses to do everything they can to retain workers, and also on the labour supply side to ensure people have the skills and training to either re-enter or progress through the Scottish labour market. Now is the time for a society wide, civic approach with the real integration of government, agencies, local authorities, learner providers, third sector and businesses to work collectively and at pace to help mitigate the scale of the rise in unemployment and the longer-term scarring effects which we have witnessed in past economic downturns.

Businesses need to step up and play a key role in avoiding taking short-term decisions which will exacerbate the rise in unemployment. At the same time Ministers need to clearly signal priority areas that will drive the recovery and enable education establishments to have greater flexibility to tailor training provision, co-designed with business, to provide clear pathways for people into employment.

We are grateful for the contribution from members of the sub-group, their networks, the wider Strategic Board and the many other contributors in shaping this report.

Co-Chairs, Enterprise and Skills Strategic Board Sub-group