Scotland's National Strategy for Economic Transformation Programme 1: Entrepreneurial People and Culture Equality Impact Assessment (Record and Results)

Young people

Young people (16-24 year olds) are more likely to be unemployed than older age groups and are vulnerable to long-term employment 'scarring'^[23]. They are more likely to earn less than the real Living Wage, and are more likely to be financially vulnerable and in unmanageable debt.

11.5% of young people aged 16-24 were not in employment, education or training (NEET) in 2021 (Jan-Dec). This represents a decrease of 0.9 percentage points from the previous year (2020), but is 1.3 percentage points higher than 2019.

There is recent evidence of significant improvement in business start-ups in the younger age groups.

Scotland's TE) rate for the 18-29 age group has increased over time to catch-up with rates in England and Wales, standing at 9% in the 2019-21 period, broadly in line with England and Wales. It remains unclear whether this is caused by young people's interest in pursuing an entrepreneurial career or by a lack of secure, well-paid employment opportunities.

Older People (Aged 50+)

An ageing population is also translating to an aging workforce. There is evidence the working life is getting longer with increasingly more people working beyond the retirement age.

What the evidence tells us:

Scotland has an ageing population. Scotland's population is increasing and older people represent a growing share. People are also working into older ages.

Older people are among those who have experienced disproportionate health, social and economic impacts as a result of the COVID-19 pandemic. In the year to April 2020-March 2021, the employment rate for people aged 50-64 fell by 2.6 percentage points, the largest decrease of any age group.

Despite the general increase in internet access at home (42% in 2003; 93%^[24] in 2020), digital participation is generally lower among the older population and average internet use decreases with age.
Those aged over 50 face employment barriers in three key areas: communities, access to services and financial security. Ageism, exclusion and lack of willingness to recognise the skills and experience of the older workforce also present employment barriers for this group.

Annual survey of hours and earnings: 2021 - gov.scot (www.gov.scot)

Wealth in Scotland 2006-2020 (data.gov.scot)

Supporting documents - Scotland's Labour Market: People, Places and Regions – Protected Characteristics. Statistics from the Annual Population Survey 2021 - gov.scot (www.gov.scot)

Supporting documents - Scotland's Labour Market: People, Places and Regions – Protected Characteristics. Statistics from the Annual Population Survey 2021 - gov.scot (www.gov.scot)

Scotland's National Strategy for Economic Transformation: Evidence Paper (www.gov.scot)

Global Entrepreneurship Monitor: Scotland Report 2021/2022 (strath.ac.uk)

Annual Population Survey, 2021

DWP, Economic Labour Market Status of Individuals Aged 50 and Over, Trends Over time: September 2021

If not now, when? - Social Renewal Advisory Board report: January 2021 - gov.scot (www.gov.scot)

Scotland's Labour Market: People, Places and Regions - Statistics from the Annual Population Survey 2020/21 - gov.scot (www.gov.scot)

Supporting documents - Scottish Household Survey 2020 - telephone survey: key findings - gov.scot (www.gov.scot)

A Fairer Scotland for Older People: A Framework for Action (www.gov.scot)

A Fairer Scotland for Older People: A Framework for Action (www.gov.scot)

A Fairer Scotland for Older People: A Framework for Action (www.gov.scot)

Supporting documents - Scottish Household Survey 2020 - telephone survey: key findings - gov.scot (www.gov.scot)

A Fairer Scotland for Older People: A Framework for Action (www.gov.scot)

Although there is data on the labour market and age, there is limited intersectional data on entrepreneurship and younger people (16-24) and older people (55+). We will discuss and consider with analysts how this can be improved and carry out consultations as policies develop.

It is estimated that around one fifth of Scotland's working-age population is disabled. The prevalence of disability increases with age.

Available data also indicates that the proportion of disabled sole traders is relatively low in Scotland. In 2014, only 9% of Small and Medium Enterprises (SMEs, between 1 and 249 employees) in Scotland had an owner with a disability or long-standing illness, representing a decrease of 2% since 2012.

Employment barriers for people and disabled include health needs, caring responsibilities, unaffordable childcare, transport, inaccessible job adverts and application processes, workplace discrimination, lack of flexible working and adequate support and effects on benefits. To address employment barriers for disabled people and promote ongoing employment for those able to undertake paid work, as well as enabling disabled people to work more hours and take on roles that are better paid or more suited to their skills, there is a need for a greater availability of flexible working and remote working .

Disabled people are more likely to have no or low qualifications compared to non-disabled people and are less likely than non-disabled people to have qualifications at degree level or above. Even with a degree or higher qualification, disabled people are still less likely to be employed than non-disabled people without one.

Disabled pupils have lower attendance levels at school and are more likely to be excluded. Disabled young people are twice as likely not to be in a positive destination (education, employment or training) six months after leaving school, and three times as likely not to be in a positive destination by the age of 19.

Analysis by the Joseph Rowntree Foundation (JRF) found that around 56% of disabled people in the UK who were employed at the start of 2020 had reported a loss of earnings by the middle of the year (2 percentage points more than non-disabled people). The analysis also found that disabled people were also more likely to report they had zero earnings by mid-year.

Research published by Leonard Cheshire suggests that the economic impacts of the pandemic are expected to continue to have an adverse effect on access to employment and financial security of disabled people.

Stakeholders highlighted that employers need to consider and offer a range of accessible jobs and adjustments that will meet the individual needs of (young) disabled people in the workforce. Stakeholders also emphasised the need to recognise the importance and economic value of informal/unpaid care and the need for the care sector to be reflected as a priority and strategic sector within the economy.

Disabled people in the labour market in Scotland - gov.scot (www.gov.scot)

A Fairer Scotland for Older People: A Framework for Action (www.gov.scot)

Small Business Survey reports - GOV.UK (www.gov.uk). Sole traders are defined as businesses with only one owner. This figure includes small and medium enterprises with employees only (i.e. between 1 and 249 employees).

How flexible hiring could improve business performance and living standards | JRF; If not now, when? - Social Renewal Advisory Board report: January 2021 - gov.scot (www.gov.scot)

Disabled people in the labour market in Scotland - gov.scot (www.gov.scot)

Fairer Scotland for disabled people - employment action plan: progress report - year 2 - gov.scot (www.gov.scot)

Tackling child poverty: third year progress report 2020-2021 - gov.scot (www.gov.scot)

Summary Statistics for Attainment and Initial Leaver Destinations, No. 3: 2021 Edition - gov.scot (www.gov.scot); If not now, when? - Social Renewal Advisory Board report: January 2021 - gov.scot (www.gov.scot)

UK Poverty 2020/21 | JRF

Locked out of the labour market (leonardcheshire.org)

Stakeholder feedback

There is limited intersectional data on disabled entrepreneurs in Scotland so we will discuss and consider with analysts how this can be improved and carry out consultations as policies develop.

Disabled women, minority ethnic women, and lone parents (the vast majority of whom are young women), are at an even higher risk of poverty, disruption to employment chances and good labour market outcomes. The Analytical Annex to the 'Gender Pay Gap Action Plan' and the 'Gender Pay Action Plan' published by the Scottish Government sets out the drivers for gender disparities in the labour market in more detail.

Over the course of the pandemic, women's unpaid housework, childcare, and unpaid care increased. Women may also find it more difficult to secure alternative employment and income streams following lay-off.

Stakeholders have highlighted the following :

Need for integrating gender perspectives and women's needs, disadvantages and inequalities into response measures and wider economic policymaking;

Need to improve the understanding of inequality issues in the system with considerations on child-care and care economy more generally as critical to achieving women's equality;

Need to understand the links between child poverty and women's poverty;

NSET should build on the Scottish Government commitments on the gender pay gap;

Root causes of women's underrepresentation in technology and STEM sectors should be addressed;

Women's entrepreneurship base should be developed and better supported;

Investment and growth should be targeted in sectors where women's work is concentrated;

Need to enhance the quality of infrastructure that supports women to progress within the labour market, including through investing in structured, affordable and flexible childcare provision and social care; tackling occupational segregation through the development of gender-sensitive (re)training and development programmes; and

Need for expanding and funding peer-to-peer support networks and increased financial support, training and coaching for female entrepreneurs; and easier access to government contracts for women-led SMEs.

Gender Pay Gap Action Plan: Analytical Annex (www.gov.scot)

A fairer Scotland for women: gender pay gap action plan - gov.scot (www.gov.scot)

If not now, when? - Social Renewal Advisory Board report: January 2021 - gov.scot (www.gov.scot)

If not now, when? - Social Renewal Advisory Board report: January 2021 - gov.scot (www.gov.scot)

Stakeholder engagement

The Ana Stewart Review on women in entrepreneurship is currently underway and will bridge intersectional knowledge gaps on sex and entrepreneurship in Scotland.

The relationship between lack of material resources and poor health, including during pregnancy, is well established, and the birth of a new baby can result in those close to the poverty line falling below it. Pregnancy brings a period of sudden increased financial pressure and sustained money worries have been reported following birth of a baby, increasing the risk of child poverty.^[25]

Households with children aged 0-4 are at high risk of poverty. The risk, however, is much higher when the youngest child is aged less than one year old. Families with a new child are more likely to enter poverty.

Households with a baby under one year of age are one of the six priority family groups highlighted as being at higher risk of poverty. Approximately one third (34%) of children in households with a child under one were in relative poverty in 2017-20. This compares to 24% of children overall.

Motherhood has a significant impact on the number of hours that some mothers can work, which then affects their pay and income relative to non-mothers and men. Mothers suffer a big long-term pay penalty from part-time working, on average earning about 30% less per hour than similarly educated fathers. Some of this wage gap can be attributed to mothers being more likely to work part-time, or taking time out of the labour market altogether.

Unlike for women, men's work prospects do not appear to be impacted by the birth of a child. International evidence suggests that, overall, the birth of a child tends to have little impact on a father's labour force status or hours of work.

In circumstances where teenage mothers had negative experiences of education prior to pregnancy, extra care and support is required after pregnancy and birth. These mothers can find themselves becoming 'unofficially' excluded for being pregnant as they are unable to keep up with the demands of education and work around their education setting's schedule when balancing attending appointments and looking after their child. This lack of support can impact on their motivation and ability to continue with education, potentially leading to poorer employment opportunities.

Even before the pandemic, lone parents, the majority of whom are women, were more likely to be in unmanageable debt and/or financially vulnerable and more likely to live in deprived areas.

Single mothers with low qualifications are particularly concentrated in sectors most impacted by the pandemic. Households with only one earner are more vulnerable to the impacts of earnings reductions or job losses and lone parents may be less likely to have someone to share childcare with, making participation in paid work challenging.

Compared with fathers, mothers spend less time in paid work and more time on household responsibilities, and the differences in work patterns between mothers and fathers have grown since before the pandemic.

Since the start of the pandemic, mothers are more likely than fathers to have left or lost their job, or to have been furloughed, and spent on average two hours longer per day caring for children during lockdown compared to fathers.

Some of the evidence gathered above was reflected in the response to the NSET public consultation and stakeholder engagement. Stakeholders emphasised the importance of unpaid care and the care sector for gender equality, and more broadly as part of the foundation economy in many communities across Scotland. Stakeholders called for the care sector to be reflected in the strategy as a priority and strategic sector, and, with woman being more likely to take unpaid leave to care for children than men, they highlighted that an action on affordable childcare was critical for a gender-equal economic recovery.

Project Title (gcph.co.uk)

Project Title (gcph.co.uk)

Every Child, Every Chance: The Tackling Child Poverty Delivery Plan 2018-22: Annex 3 – Equality Impact Assessment (www.gov.scot)

Tackling child poverty delivery plan 2018-2022: annex 3 - gov.scot (www.gov.scot)

Tackling child poverty delivery plan: fourth year progress report 2021-2022 - focus report on households with babies under one - gov.scot (www.gov.scot)

Microsoft Word - The Motherhood Pay Penalty key findings in new template RS SH SB.docx (tuc.org.uk); Mothers suffer big long-term pay penalty from part-time working - Institute For Fiscal Studies - IFS; wcms_371804.pdf (europa.eu).

BN223.pdf (ifs.org.uk)

The Effect of a First Born Child on Work and Childcare Time Allocation: Pre-post Analysis of Australian Couples, G. Argyrous, L. Craig & S. Rahman, 2017; The Impact of Work-Family Policies on Women's Employment: A Review of Research from OECD Countries, A. Hegewisch & J. Gornick, 2011

Tackling child poverty delivery plan: fourth year progress report 2021-2022 - focus report on households with mothers aged 25 or under - gov.scot (www.gov.scot)

Covid+and+Inequalities+Final+Report+For+Publication+-+PDF.pdf (scotland.gov.uk); Scottish household survey 2018: annual report - gov.scot (www.gov.scot); Scottish household survey 2018: annual report - gov.scot (www.gov.scot).

not-now-social-renewal-advisory-board-report (1).pdf (scotland.gov.uk)

Coronavirus (COVID-19): impact on equality (research) - gov.scot (www.gov.scot); Covid+and+Inequalities+Final+Report+For+Publication+-+PDF.pdf (scotland.gov.uk)

'Interrupted' is defined as doing at least one work and one non-work activity during an hour-long slot.

Microsoft Word - BN290-Mothers-and-fathers-balancing-work-and-life-under-lockdown.docx (ifs.org.uk)

Women doing more childcare under lockdown but men more likely to feel their jobs are suffering (kcl.ac.uk)

Stakeholder feedback

There is limited intersectional data on pregnancy and maternity and entrepreneurs in Scotland. We will discuss and consider with analysts how this can be improved and carry out consultations as policies develop.

Trans people face a range of disadvantages and vulnerabilities in their everyday life and in employment.

Some trans people find getting into work difficult or challenging, with prejudice and stereotyping having negative impacts on their employment prospects.

Although the following relate to the labour market some of these issues will also touch on embarking on entrepreneurial journeys. In particular proof of qualifications matching gender and new name and application forms excluding non-binary identities: Barriers and challenges to the inclusion of trans and intersex employees include lack of knowledge by employers and fellow employees, insufficient line manager confidence, stigma, practical considerations (e.g. toilet facilities, uniforms), lack of support and flexible policies. Barriers to accessing employment include fear of prejudice, application forms excluding non-binary identities, difficulties obtaining references and proof of qualification matching gender and new name, lack of awareness and transphobia from interview panels, and feeling unable to be open about trans identity when applying for jobs.

Trans students experience harassment and discrimination at HE institutions and, for some, this has a significant negative impact on their studies, future plans and skills.

Stonewall | LGBT in Britain - Trans Report (2017) (stonewallscotland.org.uk); Trans People and Work in Scotland (lgbthealth.org.uk)

Trans People and Work in Scotland (lgbthealth.org.uk)

Supporting trans employees in the workplace | Acas; Trans People and Work in Scotland (lgbthealth.org.uk)

Trans People and Work in Scotland (lgbthealth.org.uk)

There is limited intersectional data on transgender and non-binary entrepreneurs in Scotland. We will discuss and consider with analysts how this can be improved and carry out consultations as policies develop.

While attitudes towards lesbian, gay and bisexual people have become more positive over the past decade in Scotland, they continue to face a range of inequalities and disadvantage across a number of areas and settings, including employment, healthcare and education.

Compared to heterosexual adults, lesbian, gay, bisexual or other adults were more likely to be younger, live in deprived areas, report bad general health, be unemployed and have a degree.

Sexual orientation in Scotland 2017: summary of evidence base - gov.scot (www.gov.scot)

There is limited intersectional data on LGBT+ entrepreneurs in Scotland so we will discuss and consider with analysts how this can be improved and carry out consultations as policies develop.

Compared with the UK as a whole, Scotland's population is less ethnically diverse and its minority ethnic population is less likely to be born in the UK.

Compared with the white population, minority ethnic groups are more likely to work in accommodation and food services, more likely to earn low income and less likely to have savings.

Poverty rates for people in minority ethnic households are higher than for the general population in Scotland and minority ethnic people are more likely to be in relative poverty after housing costs. Minority ethnic families are also most at risk of child poverty (38% of children in minority ethnic families were in relative poverty in 2017-20 compared to 24% of all children in Scotland), and families from some minority ethnic groups are more likely to have three or more children, putting them at higher risk of child poverty .

Some minority ethnic households are also more likely to live in the most deprived areas in Scotland compared to white Scottish/British households.

Analysis by ethnicity shows a TEA rate of 15.5% amongst Scotland's non-white population, which is higher than for the general population at 9.2% in 2021. For some, however, entrepreneurial activity may be partly undertaken as a result of discrimination in the labour market.

Over a fifth of UK minority ethnic workers who were furloughed during the first lockdown in 2020 were no longer working by September 2020, more than double the overall rate.

The employment of minority ethnic people was disproportionately impacted by previous economic recessions, with profound implications for living standards and overall income and wealth equality.

Stakeholders highlighted that there is a lack of representation of ethnic minorities in policy-making processes and that black and minority ethnic business owners, whilst very seldom included, have a substantial footprint across Scotland. They emphasised that diversity needs to be harnessed across Scotland's business community and that diversity must be valued in order to drive innovation and deliver revenue growth. Stakeholders also emphasised that barriers to employment for ethnic minority groups in Scotland must be considered and addressed.

Annual Population Survey, ONS

Scotland's Labour Market: People, Places and Regions – background tables and charts - gov.scot (www.gov.scot)

If not now, when? - Social Renewal Advisory Board report: January 2021 - gov.scot (www.gov.scot)

If not now, when? - Social Renewal Advisory Board report: January 2021 - gov.scot (www.gov.scot)

Poverty and Income Inequality in Scotland 2017-20 (data.gov.scot)

Poverty and Income Inequality in Scotland 2017-20 (data.gov.scot)

Housing needs of minority ethnic groups: Evidence review

Total Early-stage Entrepreneurial Activity Global Entrepreneurship Monitor: Scotland Report 2021/2022 (strath.ac.uk)

If not now, when? - Social Renewal Advisory Board report: January 2021 - gov.scot (www.gov.scot)

Coronavirus (COVID-19): impact on equality (research) - gov.scot (www.gov.scot)

UK level data from Family resources Survey 2017-20. Note: "Working household" refers to someone in the household being in paid work.

If not now, when? - Social Renewal Advisory Board report: January 2021 - gov.scot (www.gov.scot)

Stakeholder feedback

While business start-up rate is high among ethnic minority groups work is needed to understand potential barriers to success, such as access to finance, access to business supports.

There is limited intersectional data on minority ethnic entrepreneurs in Scotland so we will discuss and consider with analysts how this can be improved and carry out consultations as policies develop.

There is no Scotland-specific data available on religion or belief and entrepreneurship in Scotland.

However, In 2015-20, relative poverty rates were considerably higher for Muslim adults (52%) compared to adults overall (18%).

Poverty and Income Inequality in Scotland 2017-20 (data.gov.scot)

Stakeholder feedback

There is limited intersectional data on Religion or Belief and entrepreneurship in Scotland. We will discuss and consider with analysts how this can be improved and carry out consultations as policies develop.

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