The Scottish economy is unlikely to bounce back from the coronavirus lockdown in “leaps and bounds” in the next couple of weeks as the country starts “to emerge slowly from its enforced spring hibernation,” according to the latest report from the Fraser of Allander Institute.
The report said the threat of a second wave of the pandemic will never be far from people’s minds and that Scotland “may be left in this confidence limbo” for quite some time.
“Whilst still early days, the first stage of easing of lockdown in England has not had dramatic effects on economic indicators so far,” said the report.
“Given that we are taking a slightly more cautious approach in Scotland we therefore aren’t likely to see the Scottish economy coming on leaps and bounds in the next couple of weeks.
“Understandably, a lot of people are very concerned and anxious – both for health and financial reasons.
“This loss of confidence in ‘normal life’ may not go away for some time yet, and this will have consequences in turn for the economy (particularly parts of our economy that rely upon social spending, such as retail and hospitality).
“Given that a threat of a second wave of the pandemic will never be far from people’s minds, we may be left in this confidence limbo for quite some time.
“It will only be as people start to remerge from their homes that we will see how people adapt and what kind of economy we have to start to rebuild.”