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Scotland’s GDP fell by 0.8% in June, figures show

·2-min read

Scotland’s onshore GDP fell by 0.8% in June, government estimates show.

Output had risen by 0.6% between April and May before the most recent downturn, leaving GDP 0.4% higher overall compared with the pre-pandemic level in February 2020.

The services sector experienced no growth in June, according to the latest figures, while customer-facing services output fell by 0.6% and health, education and public services fell by 0.3%. All other sectors saw growth of 0.4%.

Compared with the previous month, output in the production, construction and agriculture sector fell by 3.1%.

Meanwhile, the Scottish Government estimated GDP did not grow at all in the second quarter of 2022, between April and June.

The government described the change between the first and second quarter of this year – falling from 1% growth to 0% – as a “sharp slowdown”.

The main reason for the downturn was given as a fall in health and social care work activity as a result of the end of the test, trace and vaccine programmes related to the coronavirus pandemic.

Deputy First Minister John Swinney said initial growth earlier in the year was being suppressed by “extremely challenging economic conditions” and he repeated calls for action from the UK Government.

“The First Minister has committed to a review of the Scottish Government’s budget to assess all opportunities to target additional resources towards households and businesses during the cost crisis and, in turn, support the economy.

“But there are also a number of responses needed urgently from the UK Government given their reserved powers.

“We have been in regular dialogue with business organisations and leaders and support their calls for measures related to energy prices, VAT reduction and staff shortages to be brought forward by UK ministers.

“Without these, Scotland’s and the UK’s economy, businesses and households will suffer as a result.”

Scottish Secretary Alister Jack said: “We are facing unprecedented global challenges, but our economy showed huge resilience emerging from the pandemic and I feel sure we will come through these uncertain times too.

“Supporting families and businesses is our priority. A quarter of all UK households will receive £1,200 of direct help as part of our £37 billion package to assist the most vulnerable with the first cost-of-living payments already paid out to over seven million people.

“Our steps to support businesses include slashing fuel duty, reducing employer national insurance and freezing alcohol duty which helps pubs and our hospitality industry.

“All this is in addition to the Scottish Government receiving a record £41 billion per year settlement for the next three years.”