Chamber and committees

I will change the order and bring in Gordon MacDonald, but Michelle Thompson has a supplementary. Could you direct it to one of the panellists, please?

I thank all three witnesses. That was not the cheeriest note to end on, but it has been a productive session. We appreciate the time that you have given us, which will help to inform our work in the coming weeks.

I move the meeting into private session.

I will come to Susan Murray and change direction to talk about the impact that inflation is having on employment. Figures out today show that Scotland has really high employment, and I have also seen figures that show that women’s employment is higher than it has been for quite a long time. The labour market is therefore buoyant, but it is also tight.

The papers also seem to suggest that unemployment is starting to creep up. There are concerns that the labour market is tight but that businesses are under so many cost pressures that, even in areas where the labour market is quite buoyant, businesses will start to contract because of other pressures in the economy, and that could lead us to more unemployment. Could you do some forecasting around what we can expect to see in employment next year?

Mr Simpson, you can have one more question, but Professor Chadha wants to come in, so perhaps you could invite him.

Yes.

It is fine, Susan. Broadcasting will sort it out. Go ahead.

I recognise that none of the panel members is an expert in energy but, if they wish to answer the question in broader terms, they should go ahead.

We have gone beyond the time that we had estimated. If the witnesses are happy to continue for 10 minutes or so, I will bring in Michelle Thomson. I understand that Professor Chadha wants to come back in on the questions from John Mason—Professor Chadha, you can add that to the response to Michelle, if you wish.

Good morning and welcome to the 30th meeting in 2022 of the Economy and Fair Work Committee. Our first item of business is a decision on taking items 3 and 4 in private. Do members agree to take those items in private?

Members indicated agreement.

Our next item of business is an evidence session on Scotland’s economic outlook. The purpose of today’s session is to consider the key economic trends that our economy faces and to look towards the challenges of 2023. We will have further sessions on this before the end of the parliamentary year.

I welcome Professor Jagjit Chadha, director of the National Institute of Economic and Social Research; Emma Congreve, deputy director of the Fraser of Allander Institute; and Susan Murray, director of the David Hume Institute.

As always, if members and witnesses keep their questions and answers as concise as possible, we will get through a lot of questions and business.

I will start by asking the witnesses about inflation. This morning, we had the news that inflation has dropped slightly from where it was last month. A few weeks ago, the committee took evidence from the hospitality sector that the inflation rate is having a huge impact on many areas of the economy and on hospitality, in particular. Although there has been a slight decrease in the inflation rate, it is anticipated that it will come down to about 7 per cent next year. When will that have a positive impact on businesses? Is it likely to start to make those sectors that are under huge cost pressures more affordable? When is that likely to happen?

I will ask Professor Chadha to give an overview of the situation at United Kingdom level. That would be helpful.