Aberdeen’s Economy, Business Innovation, Jobs and Skills, Industry and Infrastructure
Cities are the UK’s economic engines, as jobs, innovation, and valuable infrastructure are plentiful in urban centres all over the country. But some cities do better than others. The most recent Centre for Cities report has reviewed how the UK’s major cities have fared over the past decade, particularly in terms of economic development, business innovation, infrastructure, and jobs growth. Not surprisingly, analysts at the Centre for Cities found out that Aberdeen is among the country’s top five stand-out cities along with London, Cambridge, Milton Keynes, and Coventry. The Scottish city is now a well-established and dynamic centre of economic growth, and in this post we examine the reasons behind Aberdeen’s remarkable success.
Aberdeen’s economy: a successful model of growth
Local businesses in Aberdeen are clearly driving economic growth, not only in the city itself, but also at regional and national level. For example, a survey published by the local city council revealed that Aberdeen City and Shire companies generate over £68 billion in revenues every year, with almost 80% of that total attributable to enterprises in Aberdeen City itself, accounting for nearly a quarter of Scotland’s total economic output. The Scottish city is ahead of many others when it comes to its GVA per resident levels, which are nearly £62,000 per employee and the third highest in the country.
But in order to support continued economic growth, the city has had to look beyond its own boundaries. Nowadays, local companies have close ties with some of the world’s most thriving markets, including Brazil, China, Hong Kong, Mexico, Taiwan, Russia, and Canada. Aberdeen’s recipe for success is complex but effective, and there is no doubt that the city has capitalised on its own assets in order to position itself as a top location for business.
Industry and business infrastructure in Aberdeen
The energy sector has been Aberdeen’s leading industry for decades. This remains the case to this day, as approximately 31 per cent of all local businesses operate in this sector. More than 900 companies are involved in the oil and gas industry alone, whose performance is as robust as ever. In recent years the city’s industry base has become increasingly diverse, creating business opportunities for companies in the retail, wholesale, and business and professional services sectors. Other important sectors include education, leisure and hospitality, and construction.
In addition, the R&D industry has been growing at a fast pace, particularly in areas like environmental science, renewable energies, food manufacturing, and healthcare. The growth of this sector is partly due to the joint efforts carried out by the University of Aberdeen and local industry groups, whose partnership has helped promote entrepreneurship and innovation.
Key infrastructure developments are subsumed under the Strategic Infrastructure Plan, which has poured over £300 million in initiatives like the Airport Masterplan, the Energetica Corridor, the city’s exhibition and conference centre, and the Accelerate Aberdeen project.
Aberdeen: A city open to business innovation
Business registration levels have been steadily increasing since 2002. In fact, no other city in the United Kingdom has come close to experiencing Aberdeen’s levels of business stock growth. Over the past ten years, the number of businesses registered in the city has increased by an impressive 40 per cent, and it currently stands at just over 10,000 companies. The vast majority of the city’s firms (93 per cent) are small and medium-sized enterprises devoted to fostering business innovation in Aberdeen’s key industrial sectors.
Business innovation is also clearly evident in the number of patents granted to companies and individuals based in Aberdeen. According to the Centre for Cities report, during 2013, 4.4 patents were granted for every 100,000 people, a figure that turns Aberdeen into the UK’s 15th most innovative city.
Jobs and skills in Aberdeen
Aberdeen’s thriving economy and lively business scene has had a positive impact on the city’s employment levels. In 2014, employment rates reached the 77 per cent mark, which means that the Granite City is the sixth best city for jobs in the UK. But Aberdeen doesn’t just create jobs. At over £624/week, average weekly earnings in the city are among the country’s highest, and the private-to-public sector employment ratio stands out due to its balanced figures.
Data released by Aberdeen’s city council shows that the number of jobs available in the city is 8 per cent higher than ten years ago and is very much in line with the city’s population growth rates. The city’s companies provide employment to over 143,000 people. In terms of skills, 45 per cent of the workforce is comprised of highly skilled professionals, technical staff, and employees working in skilled trades. The healthy state of the local labour market is certainly an after-effect of the city’s elevated business startup rates, which are in the region of 63/10,000 people.
It is obvious that Aberdeen’s remarkable success is not down to chance. This is a city where careful planning and investment have begun to pay off and where innovation and entrepreneurship are duly rewarded.
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Sources:
http://www.theguardian.com/public-leaders-network/2015/jan/19/five-stand-out-uk-cities-jobs-business?CMP=share_btn_tw
http://www.aberdeen-info.co.uk/energy_facts.html#.VQCSvY93_FU
http://www.cnplus.co.uk/home/news-analysis/welcome-to-aberdeen-what-next-for-boom-city/8665998.article#.VQCVvI93_FU
http://www.aberdeencity.gov.uk/nmsruntime/saveasdialog.asp?lID=53760&sID=3365
http://www.abdn.ac.uk/business-info/training/entrepreneurship-176.php
https://www.skillsdevelopmentscotland.co.uk/media/1272676/sds_rsa_aberdeen_city_and_shire_dig.pdf
http://www.aberdeeninvestlivevisit.co.uk/Invest/Aberdeens-Economy/SIP/SIP.aspx