A NEW economic report has revealed that Aberdeen and Edinburgh are set to deliver strong economic results over the next 12 months.
The UK Powerhouse study, which has been produced by Irwin Mitchell and the Centre for Economics & Business Research (Cebr), analyses 50 of the largest local economies by employment and gross value added (GVA) growth.
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In the latest report, Aberdeen is ranked 7th for year-on-year GVA growth in Q4 2022 with a 3% year-on-year increase taking the total value of the economy to £16.1bn. During the same period, Aberdeen is expected to grow its employment level by 1.7%, with 3,100 more people who have jobs.
Edinburgh outperforms Aberdeen in relation to growth in the number of people who have jobs with a top 10 ranking based on a prediction that employment will grow by 2% in Q4 2022 compared to the previous 12 months.
Edinburgh’s year-on-year GVA growth expectations of 2.5% in Q4 2022 are matched by Glasgow. This growth rate is however almost a full percentage point below the fastest growing UK city economy next year, which is Reading in the South East of England.
Hannah Clipston, partner at Irwin Mitchell, said: “The UK’s economy has undergone significant change over the last two years and this report highlights that the recovery is unlikely to be linear or even uniform.
“Over the next 12 months our report predicts that manufacturing’s output will grow by 3.5% whilst for hospitality it will grow by 35%. This has a huge impact on the variations that we are seeing in terms of growth in different locations and should be considered by the government as it looks to level up.”
Irwin Mitchell’s report also examines to what extent disruption in the economy leads to innovation.
Here the study reveals that the South West and the South East of England have the largest share of businesses engaged in innovative activity. According to the study, 41% of businesses in the South West are defined as innovative compared to 34% in Scotland.
Hannah added: “Businesses have been incredibly resilient over the last couple of years and have faced many disruptors including Covid, labour shortages, supply chain issues and high fuel costs.
“Our latest study recommends that irrespective of the sector they’re in, organisations should be adopting technology more quickly and adapting to the UK’s new status after Brexit.
“All of this will require a shift in approach and for innovation to be celebrated and nurtured more than it is currently. It’s vital that businesses are encouraged to follow this path and receive the right level of support in order to help them succeed.”
