Expectations for Scotland’s economic growth have been revised up to 5.9% for 2021 and 2.5% for 2022, according to the latest Economic Commentary by the Fraser of Allander Institute (FAI) at the University of Strathclyde.
In the Deloitte-sponsored Economic Commentary, the Fraser of Allander Institute now forecasts that the economy will reach its pre-pandemic peak in the summer of 2022, three months earlier than forecast in March.
The report said that based on the latest figures “the Scottish economy is slightly ahead of the UK’s overall in terms of its recovery.”
The FAI said the Scottish economy has seen significant opening up since late April.
“This has been facilitated by the vaccine deployment, which has seen 82% of the adult population receive their first dose,” said the FAI.
“While the economy faces significant changes as it moves through to the recovery phase, the way people work has also changed, particularly for those who have been able to work from home during the pandemic.
“As some businesses begin to consider a part-time return to the office, alongside homeworking practices, it remains to be seen how persistent these changes will be.”
FAI director Mairi Spowage said: “We have today revised up our expectations for growth in 2021 and 2022.
“Despite the pausing in the easing of restrictions we have seen over the last week or so, it is undoubtedly the case that growth is returning to our economy.
“In the aggregate, consumers appear to be ready to spend the record savings that have been accumulated throughout the course of the pandemic.
“With a large proportion of the population vaccinated, people have shown that in general they are keen to spend their money in social settings to feel a bit more normality.”
But she added: “Despite our optimism, it is important to remember that forecasts are still very uncertain.
“The lengthening of the roadmap we have seen in recent days underlines the unpredictable nature of this virus, and the road ahead is likely to continue to be a bumpy one.”