Economy

We produce economic forecasts for two reasons:

1) To fulfil our remit of providing five-year forecasts of onshore Gross Domestic Product (GDP) in Scotland; and

2) To provide information on the economic variables that feed into our fiscal forecasts, such as wages, employment and hours worked that are used in the income tax forecast.

As well as GDP, our report includes forecasts of other important economic factors such as income, employment, unemployment, population and international trade.

On 31 May 2022 we produced updated forecasts for the Scottish economy. The table below shows our headline economy forecasts.

Economy forecasts, in growth rates unless otherwise stated
2020-21 2021-22 2022-23 2023-24 2024-25 2025-26 2026-27 2027-28
Gross Domestic Product -10.3 11.6 2.1 1.1 1.0 1.0 1.0 1.0
Consumer Price Index inflation 0.6 4.0 8.0 2.4 1.7 2.0 2.0 2.0
Average nominal earnings 3.8 4.4 4.1 2.9 2.9 3.1 3.2 3.3
Average real earnings 3.8 0.8 -2.7 0.4 1.2 1.1 1.2 1.3
Employment -3.8 1.6 1.5 -0.2 -0.2 -0.2 -0.3 -0.3
Unemployment rate (%) 4.0 3.9 4.0 4.0 4.0 4.0 4.1 4.1

2020-21 is outturn data available at time of publication.