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15 February 2017

FSB: Rising labour costs could make Scottish jobs market deteriorate further

Reference number: SPUR1502

Scottish unemployment rose by 6,000 between October and November while unemployment across the UK fell during the same period. The number of employed Scots increased slightly.

Unemployment in Scotland now stands at 4.9%, compared to the UK-wide figure of 4.8%.

Colin Borland, FSB’s head of devolved nations, said: “Scotland’s job figures have tracked behind the UK average for some time. We need action from Holyrood and Westminster to reverse that trend and get local economies moving.

“From April, UK Government policy changes will drive up employment costs for the average FSB employer by £2,600. This is due to pension auto-enrolment, a rise in the National Living Wage and the associated increase in National Insurance contributions. At the Budget, the Chancellor must intervene to protect our jobs market from the impact of these surging costs by expanding its successful employment allowance.”

On this year’s rates revaluation:

Colin Borland said: “This year’s rates revaluation is proving controversial both north and south of the border. Smaller firms in Scotland benefit from the most helpful reliefs anywhere in the UK – but this property-based tax requires urgent modernisation.

“The Scottish Government told FSB that 70% of firms will pay no more as a consequence of this year’s tax moves. They must quickly publish their data and analysis about the revaluation if we’re going to have an accurate understanding of the impact.

“Too few firms know how to navigate the archaic rates appeal system. The Scottish Government should address this particular problem urgently.”