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Publication - Research and analysis

Scottish economic bulletin: June 2025

Published
13 June 2025
From
Chief Economist
Directorate
Chief Economist Directorate
Topic
Economy
ISBN
9781836917595

Provides a summary of latest key economic statistics, forecasts and analysis on the Scottish economy.

Part of

View supporting documents Supporting documents

Labour Market

Unemployment rose to 4.2% in the three months to April, while earnings continued a trend of positive real terms growth.

Employment, Unemployment, and Inactivity

  • There remains underlying resilience in the labour market in the first half of the year with some indications of loosening and stabilisation in recent months.
  • The latest data (3-months to April) from the Labour Force Survey (LFS) shows that the unemployment rate in Scotland rose 0.4 percentage points (p.p) over the quarter to 4.2%, although is down 0.6 p.p when compared to the same time in 2024. Scotland’s employment rate rose over the quarter by 0.9 p.p. and by 2.1 p.p over the year, to 75.0%. The inactivity rate fell by 1.3 p.p over the quarter and by 1.8 p.p over the year to 21.6%.[7],[8]
Line chart showing Scotland’s unemployment rate increased over the three-months to April to 4.2% while the employment rate rose to 75% and inactivity rate fell to 21.6%.
  • Wider labour market indicators suggest some loosening over the past year. Latest RTI data shows that there were 2.44 million payrolled employees in Scotland in May, down by 0.3% (c. 7,800 employees) from April, and by 0.9% (c. 22,800 employees) annually.[9]
Line chart showing the number of payrolled employees has fallen over the past year while the claimant count rate has remained broadly stable.
  • However, Scotland’s claimant count unemployment rate has remained relatively stable at 3.5% in May, unchanged from April and down by 0.1 p.p (c. 1,500 claimants) over the year to 106,947 claimants.[10]

Recruitment Activity

  • Business survey evidence suggests further stabilisation in recruitment activity, with fewer businesses reporting changes in employment levels compared to recent months.
  • Online vacancies data for April shows that there were c. 42,325 newly advertised jobs online in Scotland, down 10.9% from March and down 9.5% over the year from April 2024. In the UK as a whole, online job adverts fell 15.7% over the year.[11]
Line chart showing an annual decrease in the number of new online job adverts in Scotland in April 2025.
  • Most recently, BICS data show the share of businesses expecting employee numbers to remain unchanged rose to 65.6% in June, up from 63.4% in May. The share of businesses expecting employee numbers to increase fell from 20.4% to 17.2%, similarly businesses reporting that they expect a decrease in the number of employees also fell moderately from 11.5% to 10.8%.
  • These trends suggest some loosening with hiring intentions having softened slightly. Additionally fewer businesses are planning to reduce headcount, indicating a more stable employment outlook.
Line chart showing a slight rise in the second quarter of 2025 in the share of businesses expecting the number of employees to increase and a slight fall in the share of businesses expecting a decline. Most businesses continue to expect employee numbers to stay the same.
  • Wider business survey data further indicates stabilisation with the Growth Tracker business survey showing that, on balance, Scottish businesses reported marginal job creation in May, following four months of reducing headcount.

Earnings

  • Labour earnings have continued a trend of positive real terms growth, albeit at a slower pace than in 2024 with the recent easing of real earnings growth partly reflecting the pick-up in inflation.
Line chart showing the pace of nominal and real earnings growth with the pace of real earnings growth slowing slightly at the start of 2025.
  • Nominal median monthly PAYE pay in Scotland was £2,542 in May, and grew by 5.3% on an annual basis, with the pace of growth unchanged from April. The pace of nominal growth is slightly lower than the average annual rate in 2024, however has been more stable over the past year following the volatility in recent years. Real terms comparisons are only possible up to April, where lower nominal earnings growth and rising inflation resulted in annual real-terms median earnings growth falling to 1.8%, down from 3.2% in March.[12]
  • Looking ahead, earnings growth is expected to further moderate. The Bank of England Decision Maker’s Panel (DMP) reported annual UK wage growth of 4.7% in the 3-months to May and anticipated year-ahead wage growth of 3.7%.[13]

Contact

Email: economic.statistics@gov.scot

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