GDP growth rebounded in the third quarter of 2019.
- GDP growth picked up to 0.3% in Q3 2019, having contracted in the second quarter, while growth slowed to 0.6% over the year.
- In Q3 2019, services output grew marginally (0.1%) and production output rebounded (1.1%) while construction output remained flat (0.0%).
- Manufacturing output fell further over the quarter (-0.3%), albeit more slowly than in Q2, as firms continued to navigate their way between the Brexit deadlines.
Labour market remains strong by historical standards.
- Unemployment fell to 3.8% in September - November 2019, however has risen over the past year.
- The employment rate increased over the latest quarter to 74.3%, however fell over the year by 17,000.
- Full time employment fell by 14,000 over the year, while parttime employment fell by 1,000.
- The inactivity rate rose over the quarter and year to 22.7%.
- Earnings grew 2.4% in 2019, however there are signals that the pace of growth has slowed.
- Business and consumer sentiment remain subdued.
- The RBS PMI reported a mild increase in business activity at the start of 2020 supported by an increase in new orders and business confidence. However, indicators remain subdued by historical standards.
- Consumer sentiment in Scotland picked up in Q4 2019 from a record low at the start of the year, however remains negative and notably below the series average.
GDP growth is forecast to strengthen.
- The SFC forecast the Scottish economy to grow 1.0 in 2020, rising to 1.1% in 2021, with further earnings growth expected to support household consumption.
- Brexit uncertainty, weak productivity growth and weaknesses in the global economy remain downside risks.