Scottish economy ‘still suffering from oil slump’


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The Scottish economy is still suffering the effects of a fall in the price of oil and gas, a government minister has said.

Speaking on the Sunday Politics Scotland programme, employability minister Jamie Hepburn cited a Fraser of Allander report.

It said the economy was close to recession and was performing poorly when compared with the UK as a whole.

The report suggested much – but not all – of the explanation was the oil price.

Mr Hepburn said: “About two-thirds of the sluggish growth is down to the oil and gas downturn.”

He added: “Clearly there are other underlying trends that we have to get underneath the skin of.

“But I think the other things we should reflect on are the strengths of the Scottish economy.”


Mr Hepburn says we should not overlook the strengths of the economy

Dean Lockhart of the Scottish Conservatives told the programme that the SNP had to take responsibility for economic performance.

He said: “This is a real indictment.

“The Fraser of Allander report… said we’ve had a lost decade under the SNP and that’s absolutely right.”

Scottish Labour’s Jackie Baillie said growth had fallen under the SNP.

“If you look at the Scottish economy over the last 10 years, it has grown by 1.2%,” she said.

“That’s a really small figure when you compare it to the preceding seven years, when it grew by 17%.”

Oil price

Earlier, the programme had heard from an economist who believes the oil price fall has been a factor, along with wider underlying problems.


Prof Bell says the economy has been performing “pretty poorly” for some time

Prof David Bell of the University of Stirling said: “The fall in the price of oil had a really pretty bad consequence for the North-East, which spread out across the rest of Scotland.

“I guess other parts of the economy have lacked dynamism in the last 10 years or so.

“We’ve got a situation now where the Scottish economy is performing pretty poorly for a pretty long period of time.”

He added: “One should be looking at the long-term factors.

“There what we’re thinking about is more infrastructure investment and on much more clear skills policy to ensure that if businesses do want to come to Scotland, there are the people available that could make these businesses prosper.”

David Johnstone is the managing director of the digital marketing agency After Digital.


David Johnstone says he struggles to recruit people with key skills

He told the programme that he is already aware of shortages in key skills areas.

He said: “We are finding it quite tough to get these people in.

“What we tend to see, if it’s a marketing or brand-related job ad, we are inundated and we could probably come to a short list and pick one of five people.

“The shortage of skills comes more from a technical development side of things.”

Mr Johnstone said it is very difficult for colleges and other training providers to keep up-to-date with developments in the business.

He added: “I do sympathise with them because we live and breath this every day.

“A course might start in September and by December some of the teaching of what they are trying to do might already by out of date.”