13 Jun 2022
By Jason Morris, Regional Market Leader, Scotland, PwC United Kingdom
When I first looked at the Good Growth for Cities Index to see where Scottish cities were placed, they ranked a little lower than anticipated. But when you step back, it’s not a disappointing picture - once you dive into the data, there are some very encouraging signs.
Over the decade since it first launched, the Index has looked beyond economic performance to cover what matters most to people about where they live – jobs, income, health, skills, work-life balance, housing, transport, and the environment. This year it also includes safety and the vibrancy of local high streets for the first time.
The Index allows us to take a data driven approach to recovery, giving us a clear focus for the areas that need the most attention. It also gives insight into sector-specific recovery rates, which will have a big impact on future growth for Scotland’s cities. Government, local leaders and businesses need to take the challenges seriously and work together to find the right solutions.
Good growth for Scotland
Overall, when you look at how Scottish cities performed, Edinburgh is the only one of three cities measured to appear in the top half – ranking 19 of the 51 UK cities surveyed. Aberdeen ranks 37 and Glasgow 42.
Scotland scored well in skills, work-life balance and housing affordability, but ranks poorly for health, new business and jobs. The health measure this year has changed to look at life expectancy, and this brings down our ratings, particularly in Glasgow which has the lowest health score on the index.
It’s interesting to see that people are less concerned about jobs than in previous years. It could be due to a buoyant jobs market. But is there a danger that this confidence is misplaced?
How do our cities rank?
Glasgow
While Glasgow ranks highly for income distribution and skills, it performs below average on most other measures. Thanks to government and private sector investment there is a lot of work already underway in the city to improve life for its people, and make it more attractive for investment, including recent growth and increased employment in the Financial Services sector. The recommendations in the Good Growth for Cities report could help further shape that strategy.
The highest ranked of our cities, Edinburgh comes in for special focus in the Index. As our capital, it is home to keystone institutions, such as the Scottish Parliament, three universities, a slew of private sector head offices, and its own financial district.
But it also faces a particular challenge - its 'missing middle'. The city has a lot of high paid jobs and low paid jobs, but there is a big gap in between. The local authority and its partners are focusing on reskilling to help workers develop their careers. But in some cases, the jobs they would progress to don’t yet exist.
Our recent report with the Financial Services Skills Commission aims to help businesses address the difficult challenge of regularly upskilling existing staff to meet emerging skills gaps, ultimately encouraging firms to undertake a robust forecasting of future skills needs. It’s the only way businesses will retain talent and fill the jobs that are yet to be created.
Aberdeen
Aberdeen scores well for skills – the best of the three Scottish cities surveyed. But its job market is facing challenges, as it becomes clear the pace of recovery is very different across sectors. In addition to energy, Aberdeen's reliance on agriculture and manufacturing puts it in a very different position and will undoubtedly impact economic growth. With the heightened focus on security of energy supply it will also be interesting to see how Aberdeen plays its role in helping us deliver against that backdrop. And, of course, energy transition is top of the agenda, with a focus on making sure it’s a fair transition for all.
What’s next?
Our cities – like every city across the UK – face unique challenges. But there are also opportunities. Our Green Jobs Barometer shows Scotland is the top ranked economic region in the UK. The share of green jobs created is higher here than anywhere else, and the nation is well positioned to maximise the benefits of green investment.
Against this background, we’re using our conveyancing power to bring together key voices from business, education, and government to help overcome the challenges faced by our cities and communities. Meanwhile, in the Good Growth report, our Agenda for Action sets out what can be done to achieve a fair economic recovery and sustainable growth in the coming years.
If you would like to discuss the Good Growth for Cities report or any of the implications for Scotland, please get in touch.
