Scottish economy escapes recession
Scotland's economy came close to a double dip recession last winter, according to official figures.
The latest GDP figures showed that the economy barely grew in the first three months of this year, after a sharp fall at the end of 2010.
It rose by only 0.1%, compared with the UK figure of 0.5% in the same period.
The construction sector suffered particularly badly with output falling by 3.6% while the production and service sectors both grew.
The production sector increased by 0.9% while the rise in the service sector was 0.3%.
Today brings grim data on the Scottish economy. Poor weather helps explain why the UK saw contraction in the October to December quarter.
But it's less easy to explain why Scotland's growth in the first quarter of this year - at only 0.1% - was so much weaker than the UK's 0.5% figure, itself seen as a weak rebound.
Only slightly less economic activity, and Scotland would have seen a double dip recession, with two consecutive quarters of contraction.
Underlying the headline figures, construction contracted most, and at the same rate as the UK as a whole. Manufacturing grew more strongly than the UK, but the transport and communications had markedly lower growth than the rest of the country.
Services grew a bit more slowly than the UK, but that sector's dominance of the economy means it has a big impact on widening the gap.
The sharp increases in insolvency and bankruptcy figures, also published this morning, add to the grim picture. They suggest pent-up pressure from people who sought to put off admitting financial defeat.
As with some retail businesses, it seems the recovery is proving so slow and uncertain that people's finances are running out of the hope of a turnaround.
And then there's the retail data, with no growth in spend despite high inflation.
It's no surprise that we're told by the Scottish Retail Consortium that shoppers aren't rushing to buy barbecue food, salads, and sandals, but the lack of consumer confidence isn't all about the weather.
Finance Secretary John Swinney said: "The Scottish economy returned to growth in the first quarter of this year, and since then Scotland's labour market has outperformed the UK as a whole - with lower unemployment, higher employment, and lower economic inactivity north of the border - but both the GDP and jobs figures show that there can be absolutely no grounds for complacency."
He added: "However, Scotland's recovery needs to be strengthened, and the GDP figures underline the urgent need for an economic plan B, or flexibility, from the UK government."
CBI Scotland's assistant director, David Lonsdale, said: "The decidedly modest rebound in growth in the first quarter of this year reaffirms our view that Scotland's economic recovery continues to be choppy and lacks vigour.
"Expansion in some sectors is being offset by weaker performance in others, with the contraction in construction reflecting an overhang from the appalling weather experienced this past winter."
Although the output in construction fell by 3.6%, over the year the figures showed it grew by 13.9%.
However, Michael Levack, chief executive of the Scottish Building Federation, said he was sceptical whether the figures reflected the current state of the industry and said it was very fragile.
He added: "There is still very weak activity in private housebuilding and the commercial construction sector in particular.
"Meanwhile, public budgets are being cut and building firms are being put under huge pressure as the levels of public subsidy available to fund construction of housing and other infrastructure are slashed."
The latest data includes revised GDP figures for 2010 and show the Scottish economy performed more poorly for most of the year than had originally been stated.
In the second quarter of 2010 the economy grew by 1% rather than 1.3% - in the next three months it grew by 0.4% rather than 0.5% and in the final quarter it contracted by 0.5% rather than by -0.4%.