Scottish economy ‘may not fully recover until 2023’

Updated Scottish Government modelling shows unemployment could increase to more than 10 per cent this year.

Scotland’s economy might not recover to pre-coronavirus levels until the start of 2023, according to new research.

Updated Scottish Government modelling shows the country faces a gradual recovery from the Covid-19 crisis.

The analysis by Scottish Government chief economist Gary Gillespie shows economic activity in April fell to historic lows as businesses were required to close to prevent the spread of the virus.

It says significant uncertainty remains in the economic outlook although although activity is forecast to pick up in the coming months.

Unemployment could increase to more than 10 per cent this year but is currently being contained by the UK Government’s Job Retention Scheme.

Economy secretary Fiona Hyslop said: “These figures show in stark terms the economic damage caused by the Covid-19 pandemic.

“I am aware that many people will be deeply concerned about their livelihoods as we start to emerge from lockdown, and the Scottish Government has been working tirelessly to keep businesses afloat and ensure as few people as possible lose their jobs.

“It is critical that we now gradually reopen the economy, following the routemap out of lockdown that we have drawn up in close consultation with business organisations, trades unions and regulators.

“During this critical phase we will continue to work with employers so that they can safely get back to work and help the economy on its path to recovery.”

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