What’s Happening in….

Aberdeenshire’s Economy

Annual Review November 2019

A publication by the Planning Information and Delivery Team

From mountain to sea

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What’s happening in... Aberdeenshire’s Economy

Contents

Introduction ................................................................................................................................................... 2

Latest Headlines ........................................................................................................................................... 3

Overview ...................................................................................................................................................... 3

People and Employment ............................................................................................................................... 4

Housing Market .......................................................................................................................................... 10

Businesses ................................................................................................................................................. 11

Tourism ...................................................................................................................................................... 12

Aberdeen Airport ........................................................................................................................................ 13

Fishing ........................................................................................................................................................ 13

Agriculture .................................................................................................................................................. 14

Energy Industry .......................................................................................................................................... 14

Contact Details ........................................................................................................................................... 15

Introduction

Welcome to the second edition of Aberdeenshire’s Economy, Annual Review, produced by Aberdeenshire

Council’s Planning Information and Delivery Team. Other publications in this series can be found at:

https://www.aberdeenshire.gov.uk/council-and-democracy/statistics/economy/

This publication provides a snapshot of Aberdeenshire’s economy, drawing on national statistics. The

review is published on an annual basis, supported by quarterly update bulletins.

Corresponding data tables are provided in the Aberdeenshire’s Economy Annual Review Supporting Data

publication.

For more information on any of the figures published, or for any other statistical enquires please contact an

Information and Research Officer on statistics@aberdeenshire.gov.uk

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What’s happening in... Aberdeenshire’s Economy

Latest Headlines

Brexit

Uncertainty surrounding Brexit is still currently dominating the news, with the outlook for businesses, the

economy and public finances equally unclear.

The Scottish Government’s Report: No-deal Brexit outline the potential economic implications and impact a

no deal Brexit may have on Scotland, looking at topics such as exposed sectors of employment and

workforce nationality. They are also produced an interactive map which shows Brexit vulnerability down to

datazone level. While this varies significantly across Scotland, rural areas are on average shown to be

more vulnerable.

Housing Market

There are mixed signals from the Aberdeen City and Shire housing market. There is growing optimism in

the continual revival in the oil industry, but this is occurring against the backdrop of uncertainly over Brexit.

According to the Registers of Scotland there has been a 4% increase in the number of home sales in the

North east year to date (January to August) compared to the same period 12 months ago. In Aberdeenshire

the value of transactions also increased, up 6% over this period, suggesting a market resilience in higher

end homes. However, the average price of a property in the Shire remained relatively static, dropping by

just 1% over this period.

Energy News

According to the Aberdeen & Grampian Chamber of Commerce’s Oil and Gas Survey, May 2019, 90% of

firms interviewed stated they were optimistic about the long-term future of Aberdeen as an energy hub, with

72% forecasting an increase in profits for 2019.

Two new oil fields in the North Sea, one in British waters, one in Norwegian began production in September

2019. The field is expected to produce more than 300 million barrels of oil over the next 30 years

(offshoretoday.com).

The University of Aberdeen has recently announced their intentions to set up a new Centre of Energy

Transition. The Centre “will provide a focus for all areas of energy-related research, with an emphasis on

supporting industry in the transition to clean energy and renewables”. It aims to contribute to the long-term

economic future of the north-east of Scotland.

Infrastructure

The long-awaited Aberdeen Western Peripheral Route was fully opened in February 2019 (although many

sections had been useable before this date). Not only has the new road reduced journey times around

Aberdeen, according to Galbraith property consultants the road has widened home buyers search both

north and south of the city.

Transport Scotland plans to dual the A96 between Inverness and Aberdeen, involving the upgrade of 86

miles of single carriageway between the two cities. Part of the project involves a new dual carriageway

between east of Huntly and Aberdeen. A route option assessment for the new carriageway is now

underway, following the procurement of a design consultant.

The trainline between Aberdeen and Inverness is currently being upgraded, with the entire project

scheduled to be completed by 2030. The project aims to reduce journey times, while increasing the

frequency of the service. During 2019 work began on doubling the track between Aberdeen and Inverurie

while construction started on a new station at Kintore. This is due for completion early 2020.

Aberdeen harbour has been undergoing a £350 million expansion, now due for completion in 2021. As the

works will allow cruise ships to berth alongside the dock it is anticipated the project will encourage tourism

into the region.

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What’s happening in... Aberdeenshire’s Economy

Overview

Gross Value Added (per capita) levels off in the North East

Gross Value Added

(GVA) is the measure of

the value of goods and

services produced in an

area. Using per capita

figures, you can compare

economies of varying

sizes. GVA in the North

East has remained higher

than the national average.

Between 2014 and 2016

the area experienced a

reduction in GVA but the

latest figures for 2017

show a 4% annual

increase, compared to 3%

national.

People and Employment

Aberdeenshire’s over 70s Projected to Increase

In 2018 Aberdeenshire’s

population was 261,470,

representing 4.8% of Scotland’s

total population. The authority

area has seen a small decrease

of 330 people since 2017 and is

the second consecutive year that

Aberdeenshire’s population has

fallen. This mainly due to net

migration for the area. Outward

migration has remained constant

however inward migration has

notable dropped. Aberdeen City

and Shire respectively seeing

the largest fall in net migration

for Scottish local authorities over

this period.

62% of Aberdeenshire’s

population is of working age, just

below the Scottish average of

64%. While those of

pensionable age (19%) mirrors

the national average,

Aberdeenshire has a slightly

higher proportion of under 16-

year olds living in the area.

For more information on Aberdeenshire’s population please ask about our Population Bulletins.

5% 3% 1% 1% 3% 5%

0 - 4

5 - 9

10 - 14

15 - 19

20 - 24

25 - 29

30 - 34

35 - 39

40 - 44

45 - 49

50 - 54

55 - 59

60 - 64

65 - 69

70 - 74

75 - 79

80 - 84

85 - 89

90 +

Male Population

2018

Estimated 2038

Female Population

2018

Estimated 2038

£25,685

£40,667

Scotland Aberdeen City and Aberdeenshire

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What’s happening in... Aberdeenshire’s Economy

Economic Activity

Between 2018 and 2019 the employment rate in Aberdeenshire decreased by 0.5%, compared to the national increase of 0.2%. However, it should be noted

that Aberdeenshire still outperforms the national average, with the 4th highest employment rate of the 32 Scottish Local Authorities. Unemployment levels

within the area also decreased, by 0.7% over the same period (down 0.1% nationally).

This apparent inconsistency in the figures can be explained through the rise by 1.2% in those people who are economically inactive (people not in

employment who have not been seeking work within the last 4 weeks and/or are unable to start work within the next 2 weeks). There has also been a marked

difference between male and female employment. Between 2018 and 2019 female employment rose by 2.9%, while unemployment dropped by 0.9%, while

male employment fell by 3.8% with unemployment falling by just 0.6%. This suggests more women became economically active over this time while more

men left the labour force.

Aberdeenshire Economic Activity Rates 2019

Lowest Average Highest Shire City Aberdeenshire Aberdeen City Scottish Average Scottish Range

Economic Activity Rate 70.0 77.8 90.4 83.4 80.8

Employment Rate - All 65.8 74.5 88.7 80.9 75.7

Employment Rate - Males 68.7 78.1 96.0 84.6 80.9

Employment Rate - Females 62.7 71.1 82.5 77.1 70.5

Unemployment Rate - All 1.7 4.2 6.3 3.0 6.3

Unemployment Rate - Males 1.7 4.5 7.5 3.7 5.4

Unemployment Rate - Females 1.4 3.9 7.2 2.1 7.2

Economically Inactive Rate 9.6 22.2 30.0 16.6 19.2

% Inactive Males wanting work 8.1 23.0 42.6 14.1 21.8

% Inactive females wanting work 7.9 20.2 50.3 20.7 22.3

Unemployment Indicators

While unemployment levels provide a useful insight into the condition of the local economy, such figures

are only available annually. By analysing Claimant Counts (the number of people claiming Jobseeker's

Allowance plus those who claim Universal Credit and are required to seek work) you can get a more up to

date indication of the local job market (although less comprehensive).

The figures below use Travel to Work Areas (TTWA). These are self-contained labour markets were most

residents live and work within that geographical location.

Total Claimant Count (age 16+)

August 2019 (latest)

July 2019 August 2018 Month Change

Year Change

Aberdeen City 3,855 3,650 3,060 +5.6% +26%

Aberdeenshire 2,845 2,740 1,995 +3.8% +43%

North East Total 6,700 6,390 5,055 +4.9% +33%

Aberdeen TTWA 5,145 4,875 4,080 +5.5% +26%

Fraserburgh TTWA 400 390 195 +2.6% +105%

Peterhead TTWA 635 630 470 +0.8% +35%

Turriff & Banff TTWA 395 380 245 +3.9% +61%

Claimants as a proportion of residents aged 16-64

August 2019 (latest)

July 2019 August 2018 Month Change

Year Change

Aberdeen City 2.5 2.3 1.9 +0.2 +0.6

Aberdeenshire 1.7 1.7 1.2 +0.0 +0.5

Aberdeen TTWA 1.9 1.8 1.5 +0.1 +0.4

Fraserburgh TTWA 2.8 2.8 1.4 +0.0 +1.4

Peterhead TTWA 2.7 2.6 2.0 +0.1 +0.7

Turriff & Banff TTWA 2.5 2.4 1.5 +0.1 +1.0

Unemployment Count in the North East increases during 2019

Over the last 12 months

there has been a

noticeable increase

across Aberdeenshire

in the number of people

claiming job seekers

allowance. This trend

has been mirrored

across Scotland with a

national average

increase in the number

of claims of 22%, or a

0.6 increase in the

proportion of over 16-

year olds claiming.

What’s happening in... Aberdeenshire’s Economy

5,055

6,700

4,000

4,500

5,000

5,500

6,000

6,500

7,000

Jobs

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What’s happening in... Aberdeenshire’s Economy

Education

Aberdeenshire School Leavers by highest SCQF level achieved - 2018

Local Authority

Number of leavers

No passes at SCQF

Level 3 or better

SCQF Level 3

SCQF Level 4

SCQF Level 5

SCQF Level 6

SCQF Level 7

Aberdeenshire 2,549 2.3% 0.5% 8.1% 26.4% 39.5% 23.1%

Scotland 49,748 2.2% 1.6% 10.3% 23.8% 42.0% 20.2%

In 2018 Aberdeenshire pupils were 0.1% more likely to leave school without any qualification than the

Scottish average. However, 89% of all Aberdeenshire school pupils attained a SCQF Level 5 or above,

compared to 83% in Scotland

Destination of Aberdeenshire School Pupils

In 2018 over 95% of

Aberdeenshire school pupils

went on to positive destinations.

This was 2% higher than the

national average and

represented a 1% increase from

the previous year.

67% of Aberdeenshire pupils

opted to enter further or higher

education, the same proportion

as in 2017. This compares with

62% across Scotland choosing

the same path.

Fewer pupils entered

employment or training in

Aberdeenshire compared to

Scotland, at 26% v 28% and 1%

v 2% respectively.

5% of Aberdeenshire school pupils did not go on

to postive destinations

3% unemployed

seeking a job

1% unknown

1% not employed

not seeking a

job

95% of Aberdeenshire school pupils

went on to "postive"

destinations

44% Higher Education

26% into jobs

24% Further

Eduction

1% Training

1% Voluntary

Work

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What’s happening in... Aberdeenshire’s Economy

National Insurance Registrations

1,058 new National Insurance numbers for adult overseas nationals were registered to

Aberdeenshire residents from the period July 2018 to June 2019. This accounted for 2.4%

of the total entering Scotland and was the 9th most popular local authority for overseas

nations to settle in.

85% of overseas nationals registering in Aberdeenshire came from EU countries,

down 4% from the previous period.

Of these new residents the largest proportion originated from Lithuania, with 212

new Lithuanians registering in Aberdeenshire. This was followed by Romania,

with 205 new residents and Poland with 164 new residents.

Origin of overseas residents settling in Aberdeenshire

7% from Asia

8% from the rest of the world

1% from non-EU European Countries

46% from EU8 Countries

25% from EU2 Countries

11% from EU15 Countries

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What’s happening in... Aberdeenshire’s Economy

Income and Earnings

Annual Household Income in Aberdeenshire higher than Scottish Average - 2018

Gender Pay Gap Aberdeenshire (resident based)

The median annual wage for all full-time workers in Aberdeenshire in 2018 was just over £30,823, 5% higher than the national average. Both male and female full-time workers experienced an increase in pay between 2017 and 2018 of 2% and 7% respectively. However, there does still exist a significant gap when both full and part time wages are considered. There are several causes for this, which are explored in the Scottish Government’s Report “Addressing the gender pay gap: employer methods”, 2019.

£31,669

£29,490

£29,818

£18,511

£0

£5,000

£10,000

£15,000

£20,000

£25,000

£30,000

£35,000

£40,000

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Male Full Time Workers Female Full Time Workers

All Male Workers All Female Workers

0%

2%

4%

6%

8%

10%

12%

Aberdeenshire Scotland

Scottish Average Household

Income:

£36,031 Aberdeenshire Average

Household Income:

£44,174

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What’s happening in... Aberdeenshire’s Economy

Housing Market

Aberdeenshire Sixth Highest Local Authority for Average House Prices during Q2 2019

Aberdeenshire house prices remain flat but sales increase from 2018 - 2019

From July 2018 to June 2019 the number of house sales

in Aberdeenshire rose by 11%, which compares to a

national increase of 5%.

However, prices remained relatively static for the period,

whereas across Scotland there was an average increase

of 1.5%.

House Building in Aberdeenshire anticipated to rise

988 homes were built across

Aberdeenshire during 2018. This

was 11% more than the previous

year.

Changes in the economy,

population fluctuations, local and

national politics all have a bearing

on the housing market and as

such future trends are difficult to

accurately predicted. However,

house builders are optimistic

about the market and the total

number of completions in

Aberdeenshire is projected to rise

over the next four years.

For more information please see the Housing Land Audit 2019.

£178,832

£201,801

£211,092

£0

£100,000

£200,000

£300,000

+11%

Actual Completions

Anticipated Completions

1,284 1,298

1,152

889 988 1,013

1,299

1,495

1,666

1,460

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

0.0%

£

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What’s happening in... Aberdeenshire’s Economy

Businesses

Aberdeenshire Business Enterprises compared to previous year (2017 – 2018):

1.0% 0.4% 0.7%

Number of Enterprises Number of Employees Profit Turnover

In Aberdeenshire during 2018 there were an estimated 14,185 Business Enterprises, employing 92,070

people with a turnover of £16,173 million. These figures show a small decrease in the number of

enterprises and the turnover but a slight increase in the number of employees

This is the second consecutive year where the number of enterprises in Aberdeenshire has fallen.

However, the increase in employees is a positive sign that confidence in the economy is growing.

Aberdeenshire Business Enterprises by size 2018

96% of all businesses in Aberdeenshire in 2018 employed fewer than 50 people, reflecting the national

average. They were however responsible for 53% of all business employment in the region, highlighting

their significance to the local economy. Only 2% of local businesses employed over 250 people, however

they generated 53% of the total turnover across all businesses in Aberdeenshire.

Business Start-ups and Deaths

The latest figures show that in 2017 there were 1,125 new business start-ups in

Aberdeenshire, and 1,200 business “deaths” (or closures). This equates to a

net loss of 75 businesses for the year. While encouragingly the area had the

6th highest start-up rate for all the local authorities in Scotland, it also held the

4rd highest closure rate (after Glasgow, Edinburgh and Aberdeen City).

13,645

255

285

49,210

13,350

29,520

£5,960

£2,504

£7,709

0 - 49 employees

50 - 249 employees

250+ employees

Number of enterprises Total employment Total turnover (£m)

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What’s happening in... Aberdeenshire’s Economy

Tourism

Tourism plays a significant role in the local economy, creating jobs and generating income through

attractions, businesses and services.

The below image displays data for Aberdeen City and Shire combined during 2017 (unless otherwise

specified) and has been taken from Visit Scotland’s insight department.

According to research undertaken on behalf of Visit Aberdeenshire in 2017, 56% of tourists surveyed were

either very or fairly likely to recommend Aberdeen and Aberdeenshire to friends and family as a visitor

destination. “Coastlines”, “whiskey” and “castles” were the three highest scoring tourist assets visitors

attributed to the region, where as “authentically Scottish”, “historic” and “naturally beautiful” were the three

perception statements regarding the area that promoted the highest agreement responses from those

surveyed. More tourism figures can be found at Visit Aberdeenshire’s data dashboard:

https://dashboard.visitabdn.com/

Tourism in the North East

£304 million spent by domestic

and international visitors

The average

length of staywas 5 nights,

compared to 9 nights across Scotland

58% of accomodation

rooms were

occupied, compared to 71% across Scotland

8,000 people were employed

in sustainable tourism jobs in

jAberdeenshire in 2016

There were over

1.1 million domestic and international

visitors to the region

£153m GVA was generated from tourism for the

Aberdeenshireeconomy

Overseas visitors numbers by Country of origin:

•55,000 US

•48,000 Germany

•36,000 Norway

•25,000 France

•23,000 Netherlands

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What’s happening in... Aberdeenshire’s Economy

Aberdeen Airport

Airport Passenger Numbers

While there will always be seasonal variation in the number of passengers travelling

through Aberdeen Airport, over the last 12-month period each month showed a decrease

from the same month in the previous year. The most recent figures are from July 2019,

where 280,120 passengers flew from Aberdeen Airport, a 4% decrease from July

2018. February saw the biggest % drop year on year, with 8% less passengers

flying during the month.

Aberdeen Airport Passenger Numbers fall

Fishing

The latest official figures on the fishing industry covering 2018 show a slight improvement in the industry in

the North East from the previous year. The below figures are for Peterhead, Fraserburgh and Aberdeen

harbour districts

For more information please see the Aberdeenshire Sea Fisheries Statistics.

-

50,000

100,000

150,000

200,000

250,000

300,000

350,000

Au

g-1

7

Se

p-1

7

Oct-

17

No

v-1

7

De

c-1

7

Jan-1

8

Feb

-18

Ma

r-1

8

Apr-

18

Ma

y-1

8

Ju

n-1

8

Ju

l-1

8

Au

g-1

8

Se

p-1

8

Oct-

18

No

v-1

8

De

c-1

8

Ja

n-1

9

Feb

-19

Ma

r-1

9

Ap

r-1

9

Ma

y-1

9

Ju

n-1

9

Ju

l-1

9

185,305 tonnes of fish landed, 4% up from 2017

57% of all fish landed in Scotland arrive at North East Harbours

£233 million landed value, no change from 2017

1,300 fishers employed locally, 27% of Scotland's total fishers

12-month period 12-month period

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What’s happening in... Aberdeenshire’s Economy

Agriculture

Previously, regional agricultural figures could be obtained through the Scottish

Government’s annual Economic Report on Scottish Agriculture (ERSA). However,

following a consultation has been decided to reduce the frequency of ERSA publications

from every year to every three or five years. Therefore, the June 2019 ERSA publication

has been postponed until further notice.

Below are the latest figures for the North East region for 2017:

North East % of Scotland’s Total

Total working occupiers 6,528 17%

Total full-time employees 2,183 16%

Total part-time employees 1,177 15%

Total casual and seasonal employees 1,152 14%

Total employees 4,512 15%

Total workforce (including occupiers) 11,040 16%

In 2017 the region contained 20% of all Scotland’s cattle, 10% of all sheep, 60% of all pigs and 13% of all

poultry.

Energy Industry

Monthly trend for Oil Price ($) per barrel

It’s been five year since the industry downturn and while prices may not have returned to their 2012 peak ($125 per barrel), there is a general feeling of resilience, with prices remaining above $50 per barrel over the latest two years.

The latest edition (May 2019) of the Aberdeen & Grampian Chamber of Commerce Oil and Gas Survey echoes this sentiment with 90% of those surveyed optimistic about the long-term future of Aberdeen as an oil and gas/ energy hub.

$46.52

$30.70

$81.03

$64.22

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What’s happening in... Aberdeenshire’s Economy

Contact Details

Should you have any queries regarding the content of this publication please do not hesitate to contact an

Information and Research Officer on statistics@aberdeenshire.gov.uk

Further publications are available on our webpages: http://www.aberdeenshire.gov.uk/council-and-

democracy/statistics/

If you require information on a topic not currently covered or are looking support in your own research and

analysis, please do not hesitate to get in touch.