Scotland

Scots pay rises used for savings and clearing debt

Scottish bank notes Image copyright Getty Images
Image caption Savings have been in decline in recent years

Saving by Scots - or paying off debt - has picked up, according to the most recent Scottish government figures.

They show that as pay rose last year, the extra earnings were not matched by the rise in consumer spending.

To economists, that indicates a rise in the so-called savings ratio. They see it as a possible stabilisation of a steep decline over recent years.

While pay has stagnated, many Scots have borrowed money to sustain spending levels - meaning negative savings.

With pay up 3.9%, in cash terms, in the year to the first quarter of 2019, data suggests that consumer spending was up 2.2%.

Growth rate

The gap between these figures contributes to the household savings ratio, taking it to 3.4% of income.

The findings are from the latest national accounts for Scotland, covering the first quarter of the year.

These also feature a rise in the estimated total output for the economy in the first three months of 2019.

This was previously estimated at 0.5%. As additional data has become available, that estimate has been revised to 0.6% growth.

Image copyright Scottish government

That is one notch above the growth rate estimated by the Office for National Statistics for the UK economy as a whole.

Over the preceding year, the economy is reckoned to have growth by 1.5%, whereas the equivalent UK measure is for 1.8% growth.

The January, February and March figures are reckoned to have been flattered by the stockpiling of supplies by firms, ahead of the 29 March date which was set for Brexit.

That is thought to have been followed by a running off of these stocks, meaning subsequent quarters will look much weaker.

The upward revision for Scotland was largely due to a rise in the estimated growth in output by the production sector, and notably pharmaceuticals and the drinks industry, dominated by whisky.

Data for the whole UK economy for the months since March has been much weaker for manufacturing.