An independent report on the state of Aberdeen city region’s economy published today (Thursday 22 December) highlighted continued diversification, investment in key areas of strength, skills, sustainability, and connectivity as the way to overcome the economic turbulence affecting the UK.
The 2022 Economic Policy Panel Report outlined that the city has not been immune to the negative impacts of the Covid-19 pandemic, inflation and increased food prices, even accepting that the increase in energy prices had also stimulated activity in that sector in Aberdeen.
The fifth annual report also stated that grounds for optimism include the ongoing transition to sustainable green energies as an emerging industry, initiatives to support the local labour market, the development of Aberdeen as a place to visit in its own right in addition to being a base from which to explore the region, and a local willingness to embrace change at pace.
The report’s recommendations include:
- Aberdeen City Council coordinating a review of the sectors most under pressure from the macroeconomic climate and, following discussions with national policymakers, identify options for targeted support of these sectors through the downturn;
- That the forthcoming Regional Economic Strategy has buy-in from all stakeholders across the community and focuses on long-term challenges and opportunities while being flexible with key measurable outcomes;
- That the Route Map approach to developing ‘Aberdeen the Place’ builds upon innovative projects such as the City Centre and Beach Masterplan but proceeds with a greater pace in taking decisions on redeveloping the city.
The report showed that the average real monthly salary in Aberdeen had fallen by £129 in October 2022 compared with October 2021 due to the effects of the recent spike in inflation and cost-of-living crisis. However average earnings are still higher than the Scottish average.
The panel pointed to new employment opportunities in the Tourism, Creative and Life Sciences sectors, and other positive factors such as:
- The Regional Economic Strategy;
- Investment in new digital technologies;
- A refreshed tourism strategy including the potential of attracting new cruise ships visitors through Aberdeen’s reinvigorated cultural calendar;
- Playing host to 10% of Scotland’s Life Sciences sector;
- Record numbers attending the post-pandemic return of Spectra, Scotland’s Festival of Light, and high footfall at Aberdeen’s gallery, museums and cultural events.
Aberdeen City Council Co Leader, Councillor Alex Nicoll, said: “I welcome the report which not only sets out the challenges we face as a city but more importantly the strong basis we have from which to overcome these and the opportunities we have to grow the local economy.
“Aberdeen has long been an economic powerhouse and we look to continue this. However, we cannot achieve this alone; the Council will continue to work with the private sector and both the Scottish and UK Governments in ensuring that funding is in place to take forward our ambitions.”
Fellow Co Leader, Councillor Ian Yuill, said: “I am pleased that the panel’s report has highlighted the work that is being undertaken by Aberdeen City Council and our partners to grow our economy through diversification into new digital and energy technologies as we seek to make Aberdeen an even more attractive and sustainable city in which to live and work.
“It is clear that despite the instability of the UK and World economies, the opportunities are there for us not only in the energy sector but also in tourism and culture, and we will do everything we can to build on this potential.”
The Economic Policy Panel comprised Professor Graeme Roy, Professor of Economics and Dean of External Engagement in the College of Social Sciences at the University of Glasgow and Dougie Peedle, economist member of the Armed Forces Pay Review Body and Head of Economics and Valuing Nature at the RSPB and formerly Chief Economic Adviser to the States of Jersey,
The annual report helps support the council’s annual credit rating assessment after it issued bonds on the London Stock Exchange in 2016.
The 2022 Economic Policy Panel Report can be viewed here:
Aberdeen Economic Policy Panel Report 2022 | Aberdeen City Council