Scotland's jobless rate remains below UK level

The employment rate in Scotland also fell in the three months to December

Scotland's unemployment rate has fallen to 4.5% over the last quarter, according to the Office for National Statistics (ONS).

The UK rate rose in the three months to December and is now at 5.1%, its highest level for nearly five years.

The employment rate among those aged 16 to 64 in Scotland fell slightly over the same period to 73.7%.

The Scottish government said the figures did not reflect the full impact of the coronavirus outbreak.

Separate HMRC early estimates for January 2021, also published on Tuesday, show there were 2,331,000 payrolled employees in Scotland - an increase of 8,000 from December 2020.

However, the figure is 68,000 lower than a year ago.

It's hard to get an accurate count for unemployment when more than four million people across the UK are thought to be on furlough.

Many more are also not seeking work, but they're under-employed - not working the hours they normally would.

But this latest data from the Office for National Statistics give some sense of the jobs market last year: Scottish unemployment up 26,000 and those in work down 43,000.

By year's end, the jobless rate was 4.5%: the UK, 5.1%.

The number claiming benefit because of no or low pay is 83% - up on January last year, and a higher rate than the UK.

Unemployment is set to rise when furlough is withdrawn, although with business restrictions continuing well into summer, it is expected the Westminster budget next week will see furlough extended.

Reacting to the figures, Scotland's Business Minister Jamie Hepburn said they did not reflect the full impact of coronavirus or the outlook for employment.

He said: "The Job Retention Scheme continues to play an important role in supporting employers and employees and, combined with the huge economic uncertainty caused by Brexit, this remains an extremely uncertain time for the economy and jobs.

"We have repeatedly called on the UK government to extend the Job Retention Scheme for as long as required - which will be beyond the current end date of April.

"The Scottish government continues to support employers, allocating over £3bn to help businesses since the start of this pandemic."

Chancellor Rishi Sunak said: "I know how incredibly tough the past year has been for everyone, and every job lost is a personal tragedy.

"That's why throughout the crisis, my focus has been on doing everything we can to protect jobs and livelihoods.

"At the Budget next week, I will set out the next stage of our Plan for Jobs, and the support we'll provide through the remainder of the pandemic and our recovery."

Scottish Secretary Alister Jack said the figures reflected continuing challenges as a result of the Covid pandemic.

He added: "The UK government has taken quick and decisive action to support jobs and businesses across all parts of the UK.

Our £280 billion support package which includes furlough, business loans and self employed schemes have so far protected nearly one million jobs and 100,000 businesses in Scotland."

Support measures

Stuart McIntyre, head of research at the Fraser of Allander economic institute, said: "With the prime minister announcing that the UK will be eased gradually out of lockdown, it seems inevitable that Rishi Sunak will need to keep his economic support measures - including furlough - in place for longer still.

"Lifting these support measures too early runs the risk of precipitating a sharp rise in unemployment.

"Given that we have come so far with this public health crisis, an extra few months of support makes clear economic sense."