Aberdeen and Edinburgh outperform UK since financial crash

Kevin Reynard
Kevin Reynard, PwC in Aberdeen senior partner

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Aberdeen and Edinburgh are among the UK’s Top-10 UK cities in which to live and work, according to the latest Demos-PwC report ‘Good Growth for Cities Index’.

New businesses, job creation, skills development and work-life balance have been the key long-term drivers of growth in Scotland’s largest cities since the financial crisis.

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Published today [1 November 2018], the seventh annual ‘Good Growth for Cities 2018′ index sets out to show that there’s more to life, work and general well-being than just measuring GDP.

The index measures the performance of 42 of the UK’s largest cities, England’s Local Enterprise Partnerships (LEPs) and the nine Combined Authorities, against a basket of ten indicators based on the views of the public as to what is key to economic success and wellbeing.

These include employment, health, income and skills – the most important factors as judged by the public – while housing affordability, commuting times, environmental factors and income inequality are also included, as is the number of new business start-ups.

The Granite City is sixth on the list of top-performing cities, helping it climb from 11 to nine in the overall rankings.

Edinburgh has slipped from fourth to sixth as housing affordability becomes more challenging for residents of the nation’s Capital.

Once again, Scotland’s poorest performing variable is health, with all cities at or below the UK average. However there has been an improvement in work-life balance, as defined by the percentage working more than 45 hours per week, and a strong performance in skills improvements across all Scottish cities.

Nevertheless, the latest edition shows that all three main Scottish cities are outperforming the UK in terms of jobs, skills, income and environment – four of the ten economic and social factors which combine to make the Good Growth for Cities Index.

Commenting on the index, David Brown, Head of Government & Public Sector for PwC in Scotland, said:

“Scotland’s cities are in a stronger position today than prior to the financial downturn, and that is thanks to the country having continued to invest in jobs and skills. This leaves our cities better-placed to benefit from the increases in large-scale investment as Scottish and UK government initiatives, such as City Deals, continue to roll out across the country.

“There remain challenges in our cities, however. There is a widening gap between earnings and house prices, which keeps owner occupier rates down. And Scotland continues to score either at or below average when it comes to health. These indicators are a reminder that to enjoy ‘good growth’ we need to focus on alleviating long-terms sickness as well as job creation and new business formation.

“To secure further growth, the public sector, business and the higher education institutions must collaborate effectively, to ensure our cities are ‘investor ready’, while focusing on achieving good and inclusive growth.”

Lindsay Gardiner, regional chairman, PwC Scotland, said:

“Edinburgh remains one of the best cities in the UK in which to live and do business. The recent announcement of the £1.3 billion City Deal for the region will only help the city futureproof itself in a world being rapidly altered by technology.

“While Edinburgh continues to perform above average in fields like jobs, income and skills, this year’s Good Growth for Cities Index highlights some challenges, not least of which is housing affordability. This provides evidence that Edinburgh is paying the price of its success.”

Kevin Reynard, office senior partner for PwC in Aberdeen, said:

“There has been much talk about Aberdeen’s recovery from the downturn in the oil and gas industry, which began in 2014, and this year’s Good Growth for Cities Index reinforces that this recovery is gaining momentum.

“In our Aberdeen office we’ve seen an increased appetite for deals in the city and expect this to continue as we are now beginning to see the positive effects of the higher range of oil prices.

“What is even more encouraging is to see Aberdeen return to the top ten cities in the UK. With the city the best performing in Scotland in six of 12 measures used in the Good Growth index, it is clear Aberdeen is a fantastic city with much to offer.”

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