A think-tank says new figures showing the depth of the economic downturn in Aberdeen since oil prices crashed in late 2014 highlight the risks of the city’s dependence on the oil and gas industry.
The recent Cities Outlook 2018 report, published by the London-based Centre for Cities (CfC), featured both positive and negative aspects of the Granite City economy.
CfC researcher Sania Haider has followed that up with a more in-depth analysis of what is going on in Europe’s oil and gas capital.
Her findings are in tune with what north-east business chiefs have been saying since the onset of a downturn which, thankfully, now appears to be over.
In particular, economic development body Opportunity North East has been striving to build a new future for Aberdeen city and shire which is not so heavily dependent on the offshore oil and gas industry.
Ms Haider said: “Aberdeen has long been one of the UK’s most economically buoyant cities.
“In the 11 years that Centre for Cities has published Cities Outlook – our annual health-check on UK city economies – Aberdeen has ranked among the best performing cities when it comes to wages, skill levels and innovation.
“However, the downturn in the city’s standing in a number of key areas in recent years suggests that all may not be well in the Granite City’s economy.
“While Aberdeen’s reliance on oil and gas appeared to shelter the city from the worst of the global financial crisis, the oil sector’s recent turbulence has pulled the city into reverse at a time when other cities have been slowly improving.”
Aberdeen’s “large reliance” on one sector and how it responds to the downturn, including through diversification, will deliver key lessons for local and government industrial policy, Ms Haider added.