“Ann Frances Cooney, employment expert and partner at DWF, has commented on the latest labour market figures in Scotland.”

Considering the challenging ongoing economic environment and the raft of new employment legislation in the pipeline, the latest Scottish labour market figures for the period January to March 2025 show continued resilience.  The estimates indicate that over the quarter, the economic inactivity rate decreased while the employment and unemployment rates increased.  The headline figures for this period show the employment rate in Scotland was estimated at 74.5%, up 0.4% over the quarter.  By way of comparison Scotland’s employment rate was below the UK rate of 75%.  The unemployment rate was estimated at 4.3%, up 0.5% over the quarter.  Scotland’s unemployment rate was below the UK rate of 4.5%.

The early seasonally adjusted estimates for April 2025 from HMRC Pay As You Earn Real Time information indicate that median monthly pay for payrolled employees in Scotland was £2,533, an increase of 5.8% compared with April 2024.  We are seeing employers across the board either freeze pay or significantly limit pay increases to help combat the increase in employer National Insurance contributions and rising costs. 

As we are about to enter the summer months we may see some buoyancy in the market, particularly in sectors such as hospitality where business often improves with the better weather.  It is questionable what impact the recent fall in inflation will have on the market with analysts predicting the reduction to be short lived. 

It is essential for employers to keep on top of the forthcoming employment law developments.  Now more than ever employers must focus on engaging the workforce, fostering a positive workplace culture and creating a sense of “we are in this together”.