Autumn Statement 2016 and implications for Scotland

Fraser of Allander Institute, November 2016

Autumn Statement 2016 will be remembered for the unprecedented scale of its revisions to economic and fiscal forecasts, rather than its comparatively modest policy announcements.

Just eight months ago, George Osborne had laid out a budget that was expected to see the UK public finances return to surplus by 2019/20.

Forecasts published yesterday alongside the Autumn Statement leave that ambition (if it remained an ambition) in tatters. Forecasts for GDP growth have been revised down in 2017 and 2018, as a result of post EU-ref uncertainty and weaker consumer spending. Trade growth and migration are both expected to slow over the next ten years as the UK negotiates new trade deals post-Brexit.Continue reading

November 24, 2016

The Autumn Statement: what might it mean for the Scottish budget?

David Eiser, Fraser of Allander Institute

The new Chancellor faces a difficult balancing act in preparing his first Autumn Statement.

On the one hand he will face pressure to mitigate the risk of a post-EUref slowdown in the economy. Increases in infrastructure spending or targeted tax cuts would be the obvious antidotes to post referendum uncertainty, but he may also face pressure from Number 10 to follow through on the Prime Minister’s commitment to help the nebulously defined Just About Managing Families.

At the same time, the Chancellor will want to stress the continuing importance of fiscal prudence in order to reduce public sector debt from what Hammond himself has described as its ‘eye-wateringly high level’.

But how the Chancellor decides to respond to the fiscal and economic challenges he faces will also still have important implications for the Scottish Government’s budget. We’ll be publishing a short summary after the Chancellor’s statement and discussing the key issue in greater detail at our post-Autumn Statement briefing on Friday.

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November 22, 2016

Scotland’s Labour Market Trends in 6 Charts

Today we released a new report – to be published on a quarterly basis – which aims to provide an accessible summary of trends in the Scottish labour market.

Each quarter the report will provide a short summary of recent developments before discussing two or three issues – e.g. changes in self-employment, the fall in youth unemployment, etc – in greater depth.

It will complement our new-look Fraser Economic Commentary which will also now be published on a quarterly basis, with the next edition published next month.

This blog post provides a quick summary of the key bits of analysis in today’s publication in 6 charts! The full report can be accessed here.

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November 18, 2016

Measuring the economic successes of low carbon and renewable policies in Scotland

Grant Allan, Department of Economics and Deputy Director Fraser of Allander Institute, University of Strathclyde

It was central to 2010’s “Low carbon economic strategy for Scotland” that there could be economic opportunities in decarbonising the Scottish economy: “jobs in the low carbon sector in Scotland could… rise to 130,000, over 5% of the Scottish workforce”. The slightly later “2020 Routemap for Renewable Energy in Scotland” justified ambitious energy targets – for instance, the equivalent of 100% of Scottish electricity demand to be produced from renewables in Scotland – as “necessary to reindustrialise Scotland through 21st century technologies and seize the opportunities to create tens of thousands of new jobs and secure billions of pounds of investment in our economy”. Five years later, it is an opportune time to reflect on what we can conclude about the economic successes of low carbon and renewable energy policy in Scotland.

So are we on track to secure a jobs revolution?Continue reading

November 10, 2016

November nowcast update!

Grant Allan & Stuart McIntyre, Fraser of Allander Institute, Department of Economics, University of Strathclyde

This post also appears on our Nowcasting blog:

As usual at the start of the month we update our latest nowcasts of the economic performance of Scottish economy.

Our model produced the following estimates for the third (Jul-Sept) and fourth (Oct-Dec) quarters of 2016:

  •  Our latest nowcast for GVA growth in 2016 Q3 is 0.37% which, at an annual rate, is 1.48%.
  • Our first nowcast for GVA growth in 2016 Q4 is 0.37% which, at an annual rate, is 1.47%.

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November 1, 2016