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The value of college graduates to the Scottish economy, September 2017
3.1 Introduction
The Scottish Government has set out an ambition to deliver faster sustainable economic growth. A more
inclusive, resilient and robust economy is an ambition shared by many people in Scotland.
Colleges play a crucial role in Scotland's growth potential by enhancing human capital - whether that
be through the provision of routes from school through college, work, further training or progressing to
university; continuous skills-development (in conjunction with employers); or re-training people for new
opportunities.
In this chapter, we discuss the contribution that colleges are believed to make to our economy through the
lens of both an individual and - via the Scottish Government's Economic Strategy - the national economy.
First of all we review current economic conditions in Scotland.
3.2 Scottish Economic Conditions
Scotland's college sector underpins economic activity in Scotland. This economic backdrop - in turn - sets
the context for any analysis of college activity.
In recent years, the Scottish economy has had to respond to a number of significant economic challenges.
This includes the 2008 financial crisis, the period of significant fiscal consolidation and now the uncertain
outlook arising from Brexit.
As Chart 4 highlights, Scotland's economy showed resilience through the financial crisis, however it has
had a challenging recovery. A key reason for this has been the downturn in the oil and gas industry. This
has had a particularly significant impact on the North East and in industries tied to the North Sea.
Despite this, the labour market has held up remarkably well. Both unemployment and employment rates
are now the best they have been since records began. The employment rate in Scotland now stands at
75.2% up 1.1 percentage points on a year ago. Meanwhile the unemployment rate has fallen to 3.9% down
1.2 percentage points since last year.
Chart 4: Scottish and UK economic growth in GDP performance since 2007
Source: Scottish Government
Delivering the Economic Strategy
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115 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Economic Output (2007 Q1 = 100)
Scotland UK