Scottish unemployment rate set to hit its highest level since 1993

The Scottish unemployment rate is estimated to outstrip that of the UK and hit its highest level since 1993, according to a new report.

The Centre for Economics and Business Research (CEBR) estimates the labour market will be weaker than it was before the financial crisis as public sector jobs are cut.

In a report, the CEBR adds: "The unemployment rate in the country is forecast to rise to above that of the UK average in 2012 and remain there until at least 2016, reaching 9.7% that year. The last time that the rate surpassed this was in 1993."

The CEBR found that unemployment is likely to continue to rise over the next five years in every part of the UK except the South East and East of England, as well as London.

The report is described as an "upward revision" to unemployment rates estimated in October last year, blamed on a "generally weaker" economic outlook.

Rob Harbron, one of the report's authors and an economist at CEBR, said: "Five more years of pain are expected for much of the UK, with unemployment continuing to rise in almost every region.

"The outlook is tough for UK households, particularly those in places with a high dependency on public sector employment. Family budgets are being squeezed between the pressures of rising unemployment, low earnings growth and stubbornly high inflation."

However, finance secretary John Swinney said: "The fact is that the Scottish economy outperformed the UK as a whole in terms of GDP growth over the last two quarters of 2011 combined - and we have a higher employment rate, lower unemployment, and lower economic inactivity in Scotland compared to the position south of the border.

"The most recent real figures show that Scotland's unemployment level fell by 12,000 over the three month period December-February 2012 - the biggest fall in unemployment in Scotland for over a year."

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