Aberdeen’s economy expected to grow by more than 1% a year
Friday December 7th 2018 at 7:45 AM
Aberdeen’s economy is predicted to grow by more than 1% a year between 2018 and 2021, after three years of negative growth.
The EY Scottish ITEM club 2019 Forecast report highlighted the increase, which is the biggest rise among the cities covered in the analysis, will be largely down to a recovery in the price of oil and diversification of the economy in the North-east.
However, the labour market will continue to shrink by an average of -0.1% annually, down from nearly -2%, with the city shedding 3000 jobs a year.
Derek Leith, EY Office Managing Partner in Aberdeen, said: “It is encouraging to see a more positive trajectory for the Aberdeen economy beginning to emerge with both GVA and employment growth predicted to significantly improve in the next few years.
“Between 2015 and 2018 the city’s GVA growth averaged -1.4% but over the course of the next three years (2018 to 2021) that is expected to increase to 1.1%. Meanwhile city employment growth is set to rise from -1.9% to -0.1% for the same time periods.
“This is by no means a full recovery for the Aberdeen economy, annual GVA growth of 1.1% is good news representing a long awaited return of an upward trend but this still trails the Scotland average.
“Job creation, investment in skills and business investment remain top priorities for Aberdeen and Scotland.”
Scotland wide the picture is less promising though, with growth expected to slow to 1% due to a fall in the working age population and business investment.