Scottish Government

This page relates to the 2007 version of the National Performance Framework. Information about the current version of the NPF is available on the Scotland Performs Home Page.

Why is this Purpose target important?

Improved labour market participation is a key driver of economic growth. Increasing the number of people in employment adds to the productive capacity of the economy and makes better use of our human capital potential. It also improves the standard of living of those moving into employment and supports a more equitable distribution of the benefits of growth.

What will influence this Purpose target?

Participation rates in Scotland are influenced by demand for labour and the number of jobs in the Scottish economy as well as the supply of labour to fill those jobs. Supply depends on:

• The ability of individuals to participate in the labour market (which is influenced by health and social factors as well as skills levels).
• The willingness of individuals to participate in the workforce (which is affected by issues such as the relative incentive of seeking income from employment).
• The impact of net migration on the size of the workforce.

What is the Government's role?

The Government can take a number of actions to influence labour market participation in Scotland. These include:

• Learning, skills and well-being: ensuring the supply of education and skills is responsive to, and aligned with, actions to boost demand for skills; and removal of any barriers that stand in the way of individuals realising their potential in the workforce.
• Supportive business environment: provision of responsive and focused enterprise support to increase the number of highly successful, competitive businesses; a focus on key sectors with high-growth potential; and a competitive tax regime which gives incentives for business growth and attracts mobile factors of production.
• Effective government: supporting local employability partnerships to increase job outcomes for those disadvantaged in the labour market, developing and delivering effective and coherent services which meet the needs of individuals and the local labour market.

How are we performing?

For UK Target:

Scotland has the highest employment rate of the four countries in the United Kingdom. From the mid 1990s, Scotland's employment rate was steadily increasing, reaching a peak of 74.9 per cent during the second calendar quarter of 2007 (Apr-Jun), although over the past three years, Scotland's employment rate, along with the other countries of the UK, has been at a lower level as a result of the economic conditions. During the first three quarters of 2010 the employment rate in England was higher than in Scotland.

In the latest calendar quarter (Jul-Sep 2011), Scotland has an employment rate of 71.2 per cent, making it the highest of all UK countries. This compares to an employment rate of 70.4 per cent in England for the same quarter.

Last year in Q3 2010 Scotland had an employment rate of 70.7 per cent (second highest) and England had an employment rate of 71.1 per cent (highest), giving a gap of 0.5 percentage points in favour of England.

So over the year the gap has shifted by 1.2 percentage points to Scotland's benefit - maintaining Scotland's relative position as the top performing country in the UK on labour market participation. Please note that the 1.2 percentage point shift is based on unrounded figures.

Source: Labour Force Survey, Seasonally Adjusted data, Office for National Statistics

View data on Participation

Source: Labour Force Survey, Seasonally Adjusted data, Office for National Statistics

Methodology

This evaluation is based on: any difference in the gap within +/- 1 percentage points of the equivalent quarter in the previous year suggests that the position is more likely to be maintaining than showing any change. A movement of 1 percentage point or more in Scotland's favour suggests that the position is improving, whereas a movement of 1 percentage point or more to Scotland's detriment suggests that the position is worsening.

For information on general methodological approach, please click here.

For Organisation for Economic Co-operation and Development (OECD) Target:

The employment rate in Scotland, using the European age definition (15-64), in 2010 was 69.8% which is 0.8 percentage points lower than the previous year. Compared to the other countries in the Organisation for Economic Co-operation and Development (OECD) Scotland has moved from 11th position to having the 13th highest employment rate. Between 2009 and 2010 the gap in employment rates between Scotland and the country with the 5th highest rate (Netherlands in 2009 and now Denmark in 2010) decreased from 5.0 percentage points in 2009 to 3.7 percentage points in 2010.

Gap between the employment rates in Scotland and the fifth highest OECD country

View data on Participation

Source: Organisation for Economic Co-operation and Development, Annual Population Survey

Methodology

This evaluation is based on: any difference in the gap within +/- 0.5 percentage points of the previous year suggests that the position is more likely to be maintaining than showing any change. A movement of 0.5 percentage point or more in Scotland's favour suggests that the position is improving, whereas a movement of 0.5 percentage point or more in favour of the fifth highest OECD country suggests that the position is worsening.

For information on general methodological approach, please click here.

Further Information

Scotland Performs Technical Note

Statistics Topic Page