Question reference: S6W-05444
- Asked by: Alex Rowley, MSP for Mid Scotland and Fife, Scottish Labour
- Date lodged: 5 January 2022
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Current status: Answered by Angus Robertson on 25 January 2022
Question
To ask the Scottish Government what economic impact assessment it has undertaken on the effect of Brexit on Scottish businesses and jobs.
Answer
The Scottish Government continues to closely monitor the impact of Brexit on businesses, jobs and the wider economy.
The latest Business Impact and Conditions (BICS) survey for December shows that Brexit is having a visible impact on Scottish businesses, with 49% of all manufacturing businesses reporting higher costs due to increased paperwork and 57% facing higher transportation costs.
Early trade statistics indicate that Scottish trade with the EU in 2021 was 24% lower compared to 2019 levels. New customs regulations from the 1st January 2021 are likely to further increase barriers for Scottish businesses importing from the EU.
The latest BICS survey also indicates that Brexit has exacerbated the current labour market shortages as Scottish businesses struggle to hire workers from the EU. In manufacturing and the accommodation and food sectors around 25% of businesses with unfilled vacancies cite a reduced number of EU applicants as a cause of difficulties in hiring.
In the long run, forecasts by the Office of Budgetary Responsibility indicate that Brexit will be more detrimental to the UK’s productivity than the pandemic, causing an estimated 4% fall in productivity compared to 2% for the pandemic.