Workers in Aberdeen are several times more likely to be at risk of redundancy than in other Scottish cities, a major economic report has found.
The document, which has been published by the Economic Policy Panel, highlights the challenges faced by the Granite City as a result of the coronavirus pandemic, as well as how it can take steps back towards normality.
It said Aberdeen has faced additional challenges when compared to other cities, such as the fall in the price of oil earlier this year.
And it laid out the stark economic challenges facing the city, which accounts for around 35% of notifications for potential future redundancies – four times more than Edinburgh and six times as many as Glasgow.
The figure covers a total of 6,400 jobs.
Graeme Roy, director of the Fraser of Allander Institute, one of the organisations involved in the study, said: “One of the discussions we have in the report is some of the particular challenges Aberdeen faces in terms of its sectors and in terms of where it’s been in recent times, particularly around the energy sector.
“We are only halfway through this crisis in many ways so we really need to wait and see how proportionately or otherwise Aberdeen is affected by this. New papers show redundancies over the last three months were at record levels, so this is going to keep changing over time.
“It could be a timing issue, because it might reflect redundancies being made earlier in Aberdeen than other parts of the country. We need to wait and see if other areas catch up.
“It also reflects what we are seeing in the energy sector. The sector reacted quite quickly which is why redundancies in Aberdeen have been higher.
“It’s something we would urge people to keep a close eye on as the full effects of the crisis starts to unwind. In the next weeks and months we will see the full impacts.”
Dougie Peedle, economic associate for pro bono economics: “There’s no one bit of economic data which can summarise the situation in Aberdeen. Things are uncertain, and it’s going to take time to understand the full impact.
“Under these circumstances, when the scale of the challenge is unclear, the focus has got to be on long-term policies which are going to make Aberdeen fare well.”
The report also found transformation of the city, such as making it an attractive place to live and focusing on green energy, would be vital to safeguarding Aberdeen’s economic future.
Among its findings, the report also stressed the importance of working in partnership with bodies including the UK and Scottish Governments.
The panel also urged Aberdeen City Council to continue progress made in recent years on issues such as investment in infrastructure, a focus on skills, energy transition, and economic diversification.
Local authority co-leader Douglas Lumsden said: “The Economic Policy Panel report emphasises the need for Aberdeen to be at the forefront of Scotland’s ‘green recovery’ whilst demonstrating the importance of the city region to the UK’s and Scotland’s success.
“A commitment to combating climate change was the central theme of this year’s council budget and we have cut carbon emissions in recent years.
“The council has developed a Net Zero Vision and a Strategic Infrastructure Plan to leverage support for the region’s transition towards net zero. That will safeguard skills, create jobs for our young people and retain and attract new talent and investment here in Aberdeen.
“The report also that notes that a city’s attractiveness remains a driver of economic activity, so it’s reassuring that we have had the foresight to invest in the people and place.
“We have achieved much, but we have much to do. What’s made clear is that local authorities can’t succeed on their own. To build resilience and future prosperity, Aberdeen needs the continuing support of the wider public sector and the private sector.”
The city council’s urgent business committee has already approved a socio-economic rescue plan to get the city moving again following the health crisis.
A number of projects have been approved as part of the plan, including an energy transition zone and hydrogen hub.
Co-leader Jenny Laing said: “The emergence of Covid-19 has prompted an economic reset right around the globe, and there is no doubt Covid-19 has accelerated the need to future proof our economic success for the next generation and beyond.
“Building on previous panel recommendations, we identified a regional approach to combating climate change, producing a Net Zero Vision for Aberdeen and a Strategic Infrastructure Plan for Energy Transition.
“Despite tough economic conditions, investment continues in the north-east – in physical and social infrastructure, in energy and hospitality, as well as new industries such as the digital and creative sectors.
“I’m confident that with the continuing support of partners we’ll come through the current challenge and move forward on our economic, social and environmental transition journey.”