Contextualising Scotland’s labour market and skills system.

Scotland’s labour market has performed particularly strongly in recent times, mirroring the strength of the UK labour market and breaking records on employment (75.9%, Feb-April 2019) and unemployment (3.2%, Jan-Mar 2019). Labour market statistics released in August 2019 showed that there were 121,000 more people in work in Scotland than the pre-recession peak (Mar-May 2008).

Furthermore, labour market records have also been broken for women and young people. Between February and April 2019, the employment rate for women in Scotland reached a record high of 72.7% and the unemployment rate for young people (16-24) fell to a record low of 6.1%.

Across a number of key labour market indicators Scotland has outperformed the UK as a whole. As of August 2019 unemployment in Scotland has been lower than in the UK for the previous 11 months and July’s labour market statistics (for Mar-May ’19)1 showed Scotland outperformed the UK on employment, unemployment and inactivity rates for women and young people.

A number of skills indicators show Scotland to have progressed in recent years and to outperform other nations;

  • Scotland is ranked 1st out of 36 OECD countries in terms of high-level qualifications;
  • In Scotland more people (47.4%) aged 25-64 are educated to tertiary level (levels 5-8) than any other country in Europe.
  • The proportion of Scotland’s working age population with a degree or professional level qualification has increased from 16.8% in 2004 to 29.6% in 2018.

Increasing skills levels in Scotland mirror enhanced access to full-time higher and further education. In 2017-18, 15.6% of Scottish domiciled students starting a full-time first degree came from Scotland’s 20% most deprived areas, an increase of 1.9 percentage points from 2013-14 (13.7%). In addition, the percentage of full-time Scottish domiciled students entering further education in college that came from Scotland’s 20% most deprived areas rose by 3.3 percentage points between 2006-07 and 2017-18 to 34.1%: the highest on record.

However, even as access to formal education has increased, in-work training has fallen. In 2018, 22.5% of 16-64 year olds in work received training at work, down from 31.2% in 2004.