Understanding Scotland Economy Tracker - February 2024

Our survey shows two in three Scots (67%) have resorted to reducing non-essential purchases, while significant proportions continue measures such as cutting back on energy use (64%) and leisure activities (62%).

Additionally 45% report decreased savings contributions, and over a third are tapping into them for everyday expenses. These coping mechanisms are particularly prevalent among younger age groups, underscoring the disproportionate impact of the high cost of living on working-age individuals.

The Understanding Scotland Economy Tracker survey tracks economic attitudes and spending intentions from more than 2,000 members of the Scottish adult population every 3 months.  The fast turnaround time, as the data is published two weeks after collection, means early identification of changes in trends to support decision-makers.    

The study reveals a cautious outlook among Scots regarding future spending. Both essential and non-essential spending expectations show little change, indicating ongoing caution amidst economic uncertainty.

Furthermore, the latest findings highlight generational divides in priorities.  Healthcare and the NHS are paramount among older age groups, whilst younger individuals are more focused on addressing rising living costs.

The study also reveals growing doubts among Scots about Scotland's trajectory, with the majority (58%) believing that the country is heading in the wrong direction. This marks a three-percentage-point increase from the previous wave and reflects an increasing sense of pessimism about the future.

Read more:

• Press release - Two thirds of Scots continue to reduce spending.

• David Gow’s blog - Scotland’s Generational divide - the economy.

• Watch the launch event recording here.

Understanding Scotland Economy Tracker - November 2023

The Understanding Scotland Economy Tracker, produced by the David Hume Institute and the Diffley Partnership, marks its second birthday, showing many Scots continue to take extreme measures to navigate turbulent economic times:

• 1 in 6 people (17%) report skipping meals

• 1 in 5 people are using ‘buy now pay later’ payment plans

• 2 out of 3 people (67%) are not putting the heating on to reduce costs

For many, the ongoing challenges with the cost of living are dominating their lives with:

• 3 in 10 (29%) Scots telling us they are losing sleep due to their personal finances

Many Scots are living with severe financial precarity:

• 3 in 10 people (28%) are not confident of covering a £100 emergency expense – up three percentage points since February 2023

• This rises to 1 in 2 (49%) for an emergency expense of £500

The survey also shows 8 in 10 Scots perceive the economy as favouring the wealthy (78%), while 53% believe it primarily serves business interests.  Only 1 in 10 (10%) believe that the economy works in their own interest.

Healthcare (48%) and cost of living (42%) remain among the top concerns for Scots. 

Over three-fifths of Scots (62%) view the cost of living and inflation as a key economic priority, though this is down five percentage points from August. Poverty has become a significant concern for 32% of respondents, up three percentage points from August.

The Understanding Scotland Economy Tracker survey gathers economic attitudes and insights from more than 2,000 members of the Scottish adult population every 3 months to track changes over time. 

Read more:

• Press release - Two years of tracking shows Scots struggling with turbulent economic times.

• Shan Saba’s blog - Avoiding the cost of living carnage.

• Watch the event recording here.

The Scottish Home Report - why we need a review?

by Professor Stewart Brymer

Professor Stewart Brymer makes the case for why a review of the Scottish Home Report is needed and how it will benefit the overall aim of delivering a better built environment in Scotland – which is itself integral to economic development

Image credit: Photo by Kirsten Drew free from Unsplash on 20.08.2024

The Scottish Home Report consists of a single survey, an energy performance certificate and a property questionnaire – the latter being completed and signed by the selling home owner.

The single survey provides a comprehensive guide to the condition of the property, together with a valuation. In principle, therefore, it provides much more detailed information to both house buyers and sellers than is usually the case at present and avoids the need for competing house purchasers to commission separate surveys and valuations. It also ensures that there is an independent valuation of the property available so that potential buyers do not have to rely on the upset price or ‘offers over’ price to decide if it is likely to be affordable. In practice, there are variances in some locations on marketing techniques but in general, this has resulted in properties being marketed at or around 95% of the valuation in the single survey – the valuation being based on recent comparable evidence. The main point of negotiation with surveyors was the issue of liability. It was agreed that the surveyor’s duty of care would pass to the ultimate buyer.

Despite initial reservations, the Home Report has worked well in Scotland. However, it is not perfect. This paper discusses why a review is now required to support improvement.

About the Author

Professor Stewart Brymer graduated with First Class Honours in Law from the University of Dundee (1979).  He is a past-convenor of the Property Law Committee of The Law Society of Scotland and co-Founder of the Scottish Conveyancers Forum.

Stewart is a member of the Professorial Panel on Property law matters and is an Honorary Professor at the University of Dundee. 

He is also a prolific writer and is co-author of “Conveyancing in the Electronic Age” and “Leases” with Professor Robert Rennie and “Professor McDonald’s Conveyancing Manual” along with over 175 articles on Conveyancing and Leasing law.

 Why is DHI thinking about the Home Report?

There is much discussion about the quality of the housing stock in Scotland.  The need to retrofit ageing housing stock to cope with changing climate in the years ahead is a frequent subject of conversation.  In our previous work on the Scottish Land and Building Information System (ScotLIS), the potential for improvement in the Home Report came up in discussion but we were not able to fully explore the issue.  This discussion paper makes the case for why a review of the Home Report is needed and how it will benefit the overall aim of delivering a better built environment in Scotland – which is itself integral to economic development.

Understanding Scotland Economy Tracker - August 2023

The most recent data from the David Hume Institute and Diffley Partnership’s regular economy tracker reveals a mixed picture of public opinion on the economy.

Research shows extreme cost-saving behaviours in how Scots shop, eat and live are likely to have a disastrous long-term effect on the nation’s health.

Rising cost of living continues to dominate people’s priorities. Around half (48%) say this is a top issue facing Scotland. Two-thirds (67%) say this is a top issue for the Scottish economy.

In response, Scots report that they are shopping around, changing brands or shops, and buying reduced food to cope with rising prices.

But many are engaging in extreme cost-saving behaviours, which may have disastrous health consequences:

• 1 in 7 (15%) are skipping meals

• 1 in 4 (24%) are buying fewer fruits and vegetables

• 1 in 4 (25%) are choosing foods that require no or little cooking such as pot noodles

• More than 1 in 4 (27%) are consuming more packaged or processed foods instead of fresh alternatives.

These changes have serious public health consequences and risk exacerbating pre-existing inequalities, as working class hit hard by rising prices; over 1 in 5 (22%) of those in social grades C2DE report that their finances are much worse now than a year ago.

Scots remain sceptical and pessimistic about Scotland’s economy and direction. Over a third (38%) say that economic conditions are much worse now than a year ago, down from almost half (46%) in May, and over half (56%) believe that things in Scotland are headed in the wrong direction.

Large swathes of the population remain dissatisfied with the actions and support offered by UK and Scottish Government, local authorities, energy companies and the Bank of England. Over 80% feel that these actors have done too little to help people cope with rising prices.

Read more:

• Press release - Cost of living is a ticking time bomb.

• Press coverage - Jeremy Grant reflects on our latest Understanding Scotland economy event.

• Blog - Paying a high price for poor nutrition.

• Blog - Is Social Security Scotland a waste of money?

• Watch the event recording here.

Understanding Scotland Economy Tracker - May 2023

The most recent data from the David Hume Institute and Diffley Partnership’s regular economy tracker reveals a mixed picture of public opinion on the economy.

The economic outlook from Scots remains bleak with 62% thinking that general economic conditions will be worse in a years’ time (although this is down very slightly from 66% in February) and 45% think their personal financial situation will be worse in a years’ time (down from 48% in February).

However, while we have seen a reduction in the number of people thinking that things will be worse, optimism is not rising. Many Scots think that the economic outlook will remain the same over the next 12 months suggesting that they think that the costs and challenges they face are here to stay.

Is this a sign of people adjusting to a new normal?

In order to meet increased costs, many Scots are running down their savings, turning to credit and stopping paying into pensions:

• 4 in 10 Scots (42%) report having taken money out of their savings to
  cover higher costs

• 1 in 4 have used a credit card to make for purchases that they wouldn’t
  usually

• 1 in % have used ‘buy now pay later’ schemes to cover everyday
  spending

• A small but increasing number of Scots have stopped contributing to a
  pension (7%)

Turning to high-cost borrowing options for everyday essentials can cause the accumulation of substantial debt which will affect people’s lives for many years to come.

The Understanding Scotland: economy tracker is produced in partnership between the David Hume Institute and the Diffley Partnership. The survey gathers economic attitudes and insights from more than 2,000 members of the Scottish adult population every 3 months to track changes over time.

Read more:

• Press release - The cost of living is driving difficult choices.

• Blog by Shona McCarthy - Budgeting to save a global asset.

• Watch the event recording here.

Is trust an undervalued ingredient for a thriving economy?

Discussion paper by Charlie Woods

Published May 2023

Labour market disputes, concerns about public contracts and declining trust in government and institutions have risen up the news agenda in recent times.  All of these things impact on our economy but the importance of trust in building thriving economies, as an issue in its own right, feels under-explored. 

When governments talk of increasing productivity and economic growth, are they focusing sufficiently on the challenges posed by an unhappy workforce or the hours lost in contract disputes?  This paper argues that, although improving levels of  trust can take time, it is time well spent as it saves resources in the long term.

This paper aims to stimulate discussion about the role that trust and more collaborative relationships can play in strengthening the economy. It is written from the perspective of experience in working to stimulate economic development, help resolve commercial conflicts, facilitate dialogue and develop more effective relationships. 

This paper builds on previous David Hume Institute work on the labour market including the 2020 briefing paper on the Danish model of Flexicurity. 

About the Author

Charlie Woods has wide-ranging experience of industry, commerce, and public and private sector organisations, ranging from SMEs to government. He was previously Director of Strategy and Chief Economist at Scottish Enterprise and is now executive director of the Scottish Universities Insight Institute and Vice-Chair of the Economic Development Association Scotland (EDAS).

Charlie is an Associate of Core Solutions and has extensive mediation and facilitation experience in a wide range of fields including planning, family business, management, PPP contracts, transport infrastructure, government policy and professional services.  

Scotland's land information system: what is it and why does it matter

Published: 7th March 2023

A new report, written by land reform expert Andy Wightman, commissioned jointly by the David Hume Institute and Built Environment Forum Scotland, says the lack of a fully functioning land and building information system is holding Scotland back.

A new report, written by land reform expert Andy Wightman, commissioned jointly by the David Hume Institute and Built Environment Forum Scotland, says the lack of a fully functioning land and building information system is holding Scotland back.

The paper discusses Scotland’s land information service - what it is and why it matters - and what still needs to be done to fulfil a 2015 Scottish Government commitment in 2015 to deliver a comprehensive Scottish Land Information Service (SCOTLIS).

Information about land and buildings is used everyday by businesses, policy-makers, academics and ordinary citizens. This information ranges from land ownership to valuation, from energy efficiency ratings to building types and from vegetation cover to flood risks.

All of this information exists in some form, however much of it is not easily available and virtually none of it is made available in an integrated form. As the impacts of climate change intensify, there is even greater need for more timely, more comprehensive and more accessible information about land and buildings in Scotland.

This briefing originated from conversations as part of our largest piece of research to date, the Action Project and also connects to our work with Open Data Scotland on the potential of open data and our briefing on levelling up access to high speed broadband.

Read the press release.

About the author:

Andy Wightman is a writer and researcher focussing on land governance, land ownership and community land rights. He is the author of publications including Who Owns Scotland (1996), Scotland: Land and Power (1999), Community Land Rights: A Citizen’s Guide (2009) and The Poor Had No Lawyers (2010). He runs the Who Owns Scotland project. From 2016 to 2021, Andy was a Member of the Scottish Parliament. Andy was a Specialist Adviser to the House of Commons Scottish Affairs Committee Inquiry on Land Reform 2013-15 and was a member of the Commission on Local Tax Reform in 2015.

Photo credit: Pearse O’Halloran, free from Unsplash 07.05.2023

Understanding Scotland Economy Tracker - February 2023

The most recent data from the David Hume Institute and Diffley Partnership’s regular economic survey reveals a mixed picture of public opinion on the economy: while overwhelming pessimism coupled and evidence of harsh financial realities for households persists, people’s predictions for the next year appear less dire than in previous waves of data collection. Whether this is a sign of people adjusting to a new normal, or genuinely feeling things are improving, remains to be seen.

Scots are continuing to struggle to make ends meet as dissatisfaction with income levels remains high and people carry on cutting their discretionary spending levels in response to rising prices. On top of this people are being pushed into forgoing basic necessities, engaging in risky financial behaviours, and looking to change jobs or take on extra hours.

New questions for this iteration have displayed a stark financial fragility across the population, although this is not experienced equally. A significant minority of people are not confident that they could pay an emergency expense of £100 without having to borrow or take out a loan, and this number sharply increases for an emergency expense of £500. For those in the most deprived areas of Scotland, these numbers are much higher.

Read more:

• Press release - Scots’ pessimism about economic conditions remains.

• Guest blog - Shan Saba’s view from the West.

• Watch the launch event recording here.

Does Scotland need a digital wallet for skills?

From imagination to action discussion paper

A workforce, with individuals keeping their knowledge and skills up to date throughout their lives, is critical for the economy to thrive.  

Are employers losing time and money repeating training? How easy is it for job-seekers or employees to evidence all their skills and training?

This discussion paper explores if a digital wallet for skills could be critical missing infrastructure for both employers and individuals. What can we learn from elsewhere in the world? Could a digital wallet for skills in Scotland save both time and money, and ultimately help the economy to thrive?

Latest Understanding Scotland: Economy - November 2022

Latest research insights from the David Hume Institute and the Diffley Partnership on economic attitudes and behaviours has revealed widespread pessimism about Scotland’s economic outlook.

The Understanding Scotland: economy survey shows that households’ are continuing to cut their spending and go without necessities, despite many attempting to boost their income in different ways.

Intentions to cut spending have increased for every good and service listed in the survey since Understanding Scotland began, posing a big challenge for the Scottish economy.

The public mood on the economy has moved dramatically in the last 12 months. Just 1 in 10 Scots think the economy works primarily in their own interests, whilst 8 in 10 think it works primarily in the interests of the wealthy.

As we enter into economic recession and the UK faces its biggest drop in living standards on record, understanding people’s perceptions and behaviours is essential for all decision-makers.

Read more:

• Press release - Scots continue to cut spending.

• Read Shona McCarthy’s blog - The lifeblood of our economy is in peril.

• Watch the launch event recording here.