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RETURN OF THE JOBLESS GAP
Scottish unemployment rose by 1300 in February according to the seasonally adjusted unemployment figures just published. There are now nearly 180,000 Scots chasing 13,700 jobs. The most significant trend revealed is the reappearance of a widening jobless gap with the rest of the UK, Provisional UK unemployment stands at 6% compared with 8.3% north of the border.
This development has touched offa furious debate in press, government and business circles. During 1971-14. various commentators announced that Scotland had broken out of fity years of regional decline. Male manual carnings were above the avcrage for Britain for the first time. Industrial production was rising faster than in the UK as a whole. With the onset of the world slump in 1975, unemployment at first rose Icss in Scotland than in the rest of Britain.
Yet in its January 18th "State of the Nation" supplement. the Scotsman's cconomics editor, Michuel Fry. could say. "It is time to start getting pessimistic again about the Scottish economy."
In fact, the false dawn of the carly Seventies was based on a misreading of (f) the short-run effects of the inflation- Ted mim boom of Tory Chancellor Anthony Barber, (2) a burst of investment in the nationalised indestries and North Sea oil, which is now over, (3) a switch to wage burgaining al a UK level coupled with more overtime being worked in Scotland. There never was any oil-led "break-out" from regional decline. Now the underlying coonomic problems are reasserting themsolves:
Firstly, the falling rate of profit: over-investment plus a strong working class pushing up wages has reduced the average rate of profit in Scotland. The table shows the share of wages and profits in Scotlish national income since 1964. Despite short-time fluctuations. the share of wages is rising at the expense of profits. (But note the short term improvement in the share of profits in the carly Seventies which so misled the pundits). As far as industry is concerned, a future boom in capitalist investment in Scotland must await a decisive refersal in the relation of forces between Capital and Labour.
Secondly, the collapse of Scorrish science-hased industries: the filling rate of profit is a world wide phenomenon. It represents the end of the post-war boom based on the new light engineering. science-based and car industries, The multinational giants which established branch assembly plants in Scotland in the Fifties and Sixties are facing saturated markets, excess manufacturing capacity and intensified competition.
NCR in Dundee which invested heavily in clectro-mechanical machines now finds its markets have disappeared, NCR needs to go electronic but low profits mean it can't raise the cash. Timex has been hit by the introduction of digital watches. In February, Borroughs announced 400 redundancies at its Strathleven plant following the collapse of the market for mechanical adding machines. Honeywell Controls is scrapping two factories.
Faced with the higher wages won by union strength in the Seventies, the multinationals will jüst close down their obsolescent Scottish plants and move to countries where wages are lower. This was the original intention of Chrysler until bought off by free handouts from the Labour government.
Thirdly, there are the effects of EFC membership: free movement of capital within the FEC und higher rates of profit obtainable in the Paris-Brussels- London triangle will ensure a continued drain of resources out of Scotland. Even
Market could not reverse this coonomic logic. George Thomson, former Labour MP for Dundee Fast and latterly EEC Commisioner for Regional Affairs, underlined the effects of Market membership in an interview in the Scotsman on F'ebruary, 9th. He revealed that the Common Agricultural Policy has in fact led to the poorer parts of the Market subsidising the richer parts.
FARCE OF REGIONAL AID
Those two financial wizards of the Scottish Development Agency, Sir William Gray and Lewis Robertson, announced in a fanfare of headlines in carly February that they are giving away £1.035.000 to Stonefield Vehicles Eld., of Cumnock. Ayrshire in return for a minority interest in the company. This cash, courtesy of the cuts in education and health, will go towards building a "new, specialist heavy truck". Unfortunately, the main competitor of the now truck will be the Landrover. The Landrover is produced by Leyland. Leyland is owned by the National Enterprise Board, the big brother of the SDA!
Meanwhile, last December, the government abolished the Regional Employment Premium which gave £2 per employce to Scottish Manufacturing. Even the Secretary of the CBI in Scotland was forced to admit this would lead to the disappearunce of 10,000 jobs. The threatened loss of these jobs has received much less publicity than the 400 jobs that are supposed to be created by the Stonefield operation. Which explains what the SDA. is really about.
ECONOMIC PROGRESS?
The February issue of the Treasury's "Economic Progress Report" reveals the interesting fact that in 1975 industrial and commercial companies in Britain paid out only 5.8% of their profits in tax! Scottish Socialists and Trade Unionists can obtain the report every month free of charge from Circulation Section (H), Central Office of Information, Hercules Road, London