YOUTH unemployment is a postcode lottery with “huge disparity” in fortunes across Scotland, figures show.

According to a report released today, the country’s youth unemployment rate was 14.3 per cent in 2015, on a par with the UK average of 14.4 per cent.

However, finance firm EY, part of Ernst & Young Global Ltd, says the headline figure masks serious divisions across the country.

The top and bottom of the scale are separated by 11.5 percentage points. The problem peaked in Dundee at 19.4 per cent, falling to 7.9 per cent in the Highlands, the lowest rate recorded.

And while Falkirk had the lowest level of out-of-work young people ten years ago, changing fortunes mean its rate now sits at 18.7 per cent, the second worst in the table, followed by Glasgow at 16.6 per cent.

EY says Brexit may harm the chances of young Scots trying to enter the workplace as businesses prepare for a predicted contraction in the economy.

Mark Harvey, senior partner for EY in Scotland, said: “Youth unemployment is a major issue for the Scottish and UK economies, which could be exacerbated by a period of weaker economic growth in these uncertain times ahead.

“It has never been more important to create and foster the right conditions for young people to flourish in work, regardless of their background or circumstances.

“Corporates should be innovative in order to attract talented young people to their ranks. Business leaders could also help young people gain access into the workplace by providing them with vital skills, experience and opportunities necessary to secure work in the 21st century.

“It is vital we have a coordinated response from business, government and third sector in order to close the skills gap, secure the future prospects of our young people as well as economic prosperity and growth.”

Despite the regional differences, Scottish employment rates were said to be more stable than those in other parts of the UK. Figures from England and Wales diverged by up to 19.1 percentage points, ranging from 8.2 per cent out-of-work in Coventry to 27.3 per cent in Middlesbrough and Swansea, the worst-hit cities.

Analysis shows young people are being recruited in relatively smaller numbers than older workers into higher-pay sectors, suggesting some of the traditional routes to work and skills have become harder to access.

Meanwhile, the two sectors currently employing the most young people – services and hotels and restaurants – are each predicted to grow by less than one per cent this year.

EY chief economist Mark Gregory said: “Youth unemployment rates have fallen from the peaks we saw during the recession, when 40 per cent of the UK’s 16-17-year-olds were facing unemployment. However, a stubbornly high number of young people remain excluded from the labour market and history has shown us that young people are more exposed to economic volatility and industry restructuring than the population as a whole.

“The skills agenda is fast becoming one of the biggest priorities for UK business, with Brexit also likely to impose some restrictions to the free movement of labour in the future. It has never been more important to ensure the UK has the right mix of skills and talent, both nationally and locally, and young people are core to this.”

Calling for coordinated action, he went on: “The latest annual education and skills survey by the CBI and Pearson showed that 77 per cent of employers expect to need more staff with higher skills in the years ahead.

“It’s therefore vital that coordinated action is taken by business and government to invest in the development of young people to avoid a widening of the UK’s skills gap, particularly as the demand for low-skilled workers starts to decline in some sectors.”