Is productivity growing faster in Scotland than the UK?

Scotland’s economy has been the subject of much political debate this week, as the First Minister has been questioned over the Scottish Government’s record.

Nicola Sturgeon and her party have repeatedly been criticised over the performance of the economy north of the border by the political opposition at Holyrood.

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During a speech at the launch of the SNP’s general election manifesto on 30 May, she detailed a number of different measures on which Scotland’s economy had improved under the SNP, including a claim on productivity levels.

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On 28 May she took part in an interview with the BBC’s Andrew Neil as part of a series involving the leaders of the major parties in the UK, and made a similar claim.

Ferret Fact Service delved into the evidence behind that claim and found it to be Mostly True.

Evidence

Productivity is a measure of how efficiently goods and services are produced.

It is generally measured as the amount of output (goods and services) produced in an economy adjusted for the amount of labour (the number of workers or hours worked).

Scotland’s output, measured on a per hour basis, rose by 3.5 percentage points (inflation adjusted) in 2015, according to the latest Scottish Government figures. The equivalent period in UK, according to data provided by the Office For National Statistics (ONS), showed output increasing just 0.9 points. This amounts to productivity growing at around four times the UK rate.

If the productivity is measured by output per job, Scotland had an increase of 2.1 percentage points in real terms during 2015 compared to the UK’s 0.8.

However, Scotland economic productivity on both measures has been lagging behind the UK’s for a number of years. The 2015 results show the gap is rapidly closing, with Scotland just 0.1 points behind on per hour measure. Output per job was 97.8 per cent of the average UK value in 2015, representing a gap of 2.2 points.

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The ONS statistics are measured in a slightly different way to Scotland’s, although the methodologies are such that the UK and Scottish figures can be reasonably compared.

This data shows Scotland’s productivity per job at just 96.2 per cent of the UK average in 2015, and 98.3 per cent of the per hour productivity.

While both ONS and Scottish Government figures show Scotland lagging behind the UK as a whole, there has been progress in closing the gap under the SNP’s decade in government.

In 2007, ONS figures show Scotland per job at just 92.6 per cent per job filled and at 92.5 per cent of UK productivity per hour, while the Scottish Government statistics show a broadly similar picture.

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When assessing Scotland’s economic performance, it is important to note that the 2007 figures refer to the period before the recession which had a lasting impact on productivity statistics across the UK.

We must also take into account the issue of Scottish Government powers, which are devolved or reserved by the UK Government. Scotland has recently been handed a number of new fiscal powers, but there are still significant areas of taxation that are controlled at Westminster. There is evidence that levels of taxation, both corporate and personal, can impact on productivity.

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Ferret Fact Service verdict: Mostly True

Nicola Sturgeon is broadly accurate to point to Scotland’s productivity has been growing at a faster rate than the rest of the UK. However, it is important to note that productivity has lagged behind in Scotland for many years, and is only now catching up with the wider UK rate.

[aesop_content color=”#ffffff” background=”#333333″ width=”content” columns=”1″ position=”none” imgrepeat=”no-repeat” floaterposition=”left” floaterdirection=”up” revealfx=”off”]Ferret Fact Service (FFS) is a non-partisan fact checker, working to the International Fact-Checking Network fact-checkers’ code of principles. All the sources used in our checks are publicly available and the FFS fact-checking methodology can be viewed here. Any questions or want to get involved? Email us at factcheck@theferret.scot or join our community forum.[/aesop_content]

The SNP did not respond to an FFS request for supporting evidence.

Photo thanks to Jorge Royan, CC BY-SA 3.0

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