Scotland’s economy shrunk in June despite growing overall in the second quarter of the year, figures reveal.
The nation’s onshore GDP, which does not measure the oil and gas industry, contracted by 0.3% in June after growing by 0.2% in May.
However, in the three months to June, GDP is estimated to have risen by 0.6% – the same level as the UK as a whole.
Services, which account for around three-quarters of the economy, fell by 0.5% in June while agriculture, forest and fishing decreased by 0.3%.
Construction rose by 0.5% while production increased by 0.3%.
Overall, the services sector grew in the second quarter of the year by 0.6% while production grew by 0.8% over the same time.
Compared to Scotland’s economy in the three months up to June last year, the country’s GDP rose by 0.9%.
It comes after the Scottish Government was told it would have to make “tough decisions” in this year’s budget as it attempts to cope with serious financial pressures.
Meanwhile, Prime Minister Keir Starmer told the public this week that “things will get worse before they get better” as he warned about a £20bn financial black hole he says was left by the Tories.
Scottish Conservative shadow finance secretary Liz Smith said: “These figures are a cause for concern – particularly the contraction of Scotland’s economy during June.
“Businesses and economists have repeatedly warned the SNP that making Scotland the highest taxed part of the UK – and continuing to widen that tax gap – is stifling growth and putting jobs and livelihoods at risk, and these worrying figures bear that out.”
Deputy first minister Kate Forbes said: “Overall these figures paint a picture of a growing and resilient economy.
“The Scottish Government has made economic growth a clear priority and I am pleased to see consistent overall growth over the past six months despite harsh economic climates.
“We are investing more than £5 billion in 2024-25 to drive the economy and further initiatives will be detailed in the forthcoming Programme for Government and our Green Industrial Strategy.
“Figures for the second quarter follow the trend seen across the UK and I am optimistic about Scotland’s medium and long term economic prospects, despite the restrictions of the devolution settlement and the continuing challenges posed by Brexit. We look forward to working with the UK Government to address these challenges.
“A strong economy is fundamental to achieving the Scottish Government’s priorities of eradicating child poverty, growing the economy, tackling climate change and improving public services.”
Scottish secretary Ian Murray added: “Scotland is critical in the UK Government’s mission for economic growth, as the chancellor underlines today in Glasgow where she’ll meet with key members of the business community to turbocharge Scotland’s regeneration.
“Rebuilding is at the root of everything we do but the £22bn black hole in spending left by the previous government – the worst economic inheritance of any incoming government since the Second World War – means that tough decisions are ahead to achieve stability.
“We are making work pay, ensuring the national minimum wage is a true living wage.
“And with the end of exploitative zero-hours contracts, workers will have increased job security.
“Backed by £8.3bn of UK Government investment, Scottish-based GB Energy will bring jobs and opportunity for all parts of the UK and trade talks have resumed globally to forge stronger links with our international business partners.”
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