Scots Economy Grows Below UK & Parts Of EU

Scotland's economy has returned to growth, but is below the UK and parts of Europe.

The Bank of Scotland's latest monthly report found more people were employed during April while companies did more work.

Business activity grew for service sector companies, but manufacturing fell, with exporters having problems because of the Eurozone.

The overall figure improved to 50.7 during April, from March’s 49.4, anything above 50 shows the economy grew, anything below shows it shrunk.

Although indicative of marginal growth, the latest PMI reading was the best recorded by the survey in the year-to-date.

Donald MacRae, Chief Economist at Bank of Scotland, said: “April's PMI signalled a return to growth in the Scottish economy.

"However, the expansion was marginal and confined to the services sector with manufacturing exporters suffering from the effects of low growth in the Eurozone.

"The slowdown of the first three months of this year is slowly being reversed with both employment and new business increasing in April suggesting a return to a more normal growth rate in the second quarter.”

Responding to the PMI, a Scottish Government spokesman welcomed the figures "which indicate that the second quarter of 2015 has gotten off to a positive start in Scotland’s economy."

They said: "The PMI signalled a modest expansion in output as well as further growth in new business and another positive reading for employment.

"However, the survey also highlighted that conditions continue to be challenging for exporters in the manufacturing sector in light of the strength of the pound and weak demand from the Euro Area. That said, the stronger pound also means cheaper imported inputs which helps keep costs down.

"These figures follow on from recent labour market statistics which showed the highest number of people in employment since the pre-recession peak in employment levels in March-May 2008, as well as Scotland outperforming the UK as a whole in terms of employment and inactivity rates, there is no doubt that the recovery in Scotland is progressing.”