Transcript Aberdeen City and Shire - Skills Development Scotland

Regional Skills Assessment 2016
Aberdeen City & Shire
comprising Aberdeen City and Aberdeenshire
Contents
Section 1: Introducing the Regional Skills Assessments (RSAs)
Section 2: National Policy Context
Section 3: The National Economic and Skills Context
Section 4: Aberdeen City & Shire in Context
Section 5: Economic Performance of the Aberdeen City & Shire
Section 6: Aberdeen City & Shire Business Base
Section 7: Where are the jobs in Aberdeen City & Shire
Section 8: The People of Aberdeen City & Shire
Section 9: Aberdeen City & Shire Labour Market
Section 10: Skills Challenges in Aberdeen City & Shire
Section 11: Schools numbers and destinations in Aberdeen City & Shire
Section 12: Skills Provision in Aberdeen City & Shire
Section 13: How are Skills and Jobs Likely to Change?
Section 14: What are the key implications for the Region?
1. Introducing the RSAs
In this section:
 What are Regional Skills Assessments (RSAs)?
 What is not covered by the RSAs?
 Other sources of useful information
The 2016 Regional Skills Assessments
Regional Skills Assessments provide a coherent evidence base
on which to base future investment in skills, built up from
existing datasets
Their purpose is to:
 Support SFC, Regional Colleges, Strategic Bodies and College Boards in
negotiating Regional Outcome Agreements (ROAs) for Academic Years
2017-2020.
 Provide a framework for aligning SDS investment in individuals and
businesses.
 Assist partners in planning their strategic investment in skills.
 Support wider public and private investment propositions.
The 2016 Regional Skills Assessments
RSAs are developed by Skills Development Scotland (SDS) in partnership with
Highlands and Islands Enterprise (HIE), Scottish Enterprise (SE), the Scottish
Funding Council (SFC) and the Scottish Local Authorities Economic Development
(SLAED) Group.
They cover demand for skills, supply of people and skills, skills provision
and skills challenges.
….and include employment and GVA forecasts and trends to help identify
future skills needs
RSA cover:
RSAs do not:
 Regional performance and
characteristics
 Trends over time
 How does the region compare to
Scotland
 High level implications for skills
planning
 Provide a data matrix to allow
further analysis
× Answer every question... however
can be used alongside data matrix
and other national and local
intelligence
× Tell partners what they should do
– although RSAs are designed to
support making better informed
decisions
RSA data sources and coverage
The Regional Skills Assessments are underpinned by the 2016 data matrix of 7
workbooks, containing data on 117 social and economic indicators
With data at 3 spatial levels: Regional Outcome Agreement areas; City Region
Deal; Local Authority – with Scotland and GB/UK comparators where available
• Thedata
matrix
only including
draws upon
official
datasets
APS,
The
matrix
a full
user
guide is(including
available
at: BRES, UKCES, UK
Business Counts, Census, Scot Gov datasets) and partner data (SFC, SDS,
https://www.skillsdevelopmentscotland.co.uk/what-weSE, HIE). No primary research is involved.
do/partnerships/regional-skills-assessments
• The data matrix is found here:
Data Matrix sources include:
Partner data sources include:
https://www.skillsdevelopmentscotland.co.uk/what-we-do/partnerships/regional
Annual Population Survey
 SDS Participation Measure data
skills-assessments/
 Business Register Employment
Survey
 UKCES Employer Skills Survey
 UK Business Counts
 Census Data
 Scottish Government Growth Sector
datasets
 Scottish Index of Multiple Deprivation
 SDS Apprenticeship Family data
 SE and HIE data on Regional
Selective Assistance and Account
Managed businesses supported
 SLAED data on major infrastructure
projects
Other useful sources and publications
Other useful sources of current and forthcoming information are available.
Scottish Government Labour Market Strategy
Scottish Government Economic Strategy
Sectoral and Regional Skills Investment Plans
UKCES Employer Survey data
Fraser of Allander Institute Quarterly Economic Reports
RBS Business Monitor
Markit Economics Purchasing Managers' Index
2: National Policy Context
In this section:
 Government Economic Strategy
 Labour Market Strategy
 Youth Employment Strategy
 Skills Planning Model
 Scotland’s Skills Agencies
 Enterprise and Skills Review
Economic Strategy (1)
Scotland’s Economic Strategy (2015) reaffirms the Scottish Government’s commitment to creating a more
successful country, with opportunities for all of Scotland to flourish, through increasing sustainable
economic growth. It sets out an overarching framework for achieving the two mutually supportive goals of
increasing competitiveness and tackling inequality. It forms the strategic plan for existing and all future
Scottish Government policy and prioritises boosting investment and innovation, supporting inclusive growth
and maintaining focus on increasing internationalisation.
Labour Market Strategy (2)
Scotland’s Labour Market Strategy (2016) sets out for the first time how the labour market and wider social
and economic policies interact to drive ambitions for inclusive growth. It provides a framework for the
approach to the labour market, and describes the actions that will be taken to deliver the vision.
Vision:
“A strong labour market that drives inclusive, sustainable economic growth,
characterised by growing, competitive businesses, high employment, a skilled
population capable of meeting the needs of employers, and where fair work is central to
improving the lives of individuals and their families.“
• Five priorities:
– promoting the Fair Work Framework and encouraging responsible business;
– supporting employability and skills, so that all of our people can participate successfully in
the labour market;
– investing in our people and our infrastructure;
– fostering innovation including workplace innovation which will help spur job creation; and
– promoting Scotland internationally to improve the competitiveness of our businesses.
Youth Employment (3)
Developing the Young Workforce – Scotland’s Youth Employment Strategy (2014) sets out how the
Scottish Government will implement the recommendations from the Commission for Developing
Scotland's Young Workforce, with headline target to reduce youth unemployment by 40% by 2021:
Skills Planning Model (4)
Regional Skills Assessments are at the heart of Scotland’s Skills Planning Model by providing an evidence
base to understand demand for skills and to influence planning and investment to meet demand.
Scotland’s Skills Agencies (5)
Skills Development Scotland and the Scottish Funding Council are the two core skills agencies for
Scotland.
Skills Development Scotland
Scottish Funding Council,
Making Skills Work for Scotland:
Ambition 2025: Scotland - the Best Place in
the World to Learn, to Educate, to
Research and to Innovate
– Employers are better able to recruit the right
people with the right skills at the right time
– Employers have high performing, highly
productive, fair and equal workplaces
– People have the right skills and confidence to
secure good work, progress in their careers
and achieve their full potential
– Across all SDS services and programmes,
there is increased equality of opportunity
– SDS is recognised as an employer of choice,
an exemplar of fair work, and internationally
recognised for excellence, innovation and
customer focus
“Our ambition is that Scotland will be the best
place in the world to learn, to educate, to
research, and to innovate……with colleges
and universities making a major contribution to
Scotland’s social, cultural and economic
development.”
Priority outcomes:
•High-quality learning and teaching
•World-leading research
•Greater innovation in the economy.
Enterprise & Skills Review (6)
Report on Phase One (2016) included a series of recommendations of relevance to skills investment
planning
• “We will align the functions of our skills agencies to better join up how learning and skills
are planned and provided to learners and employers.”
• “We will conduct a comprehensive review of the Learning Journey focused on sustained
employment, with significantly enhanced use of labour market information in skills
planning at its heart.”
• “We will review the effectiveness of our investment in learning and skills to ensure we
have the right balance of provision across age groups and sectors and maximise its
contribution to productivity and inclusive growth.”
• Next steps;
– Regional partnerships
– Digital
– Enterprise support
3: Scotland’s Economic
and Skills Context
In this section:
 Economic Recession to Recovery
 Productivity
 Employment
 Non Standard Jobs
 Occupational Change
 In Work poverty
 Skills Challenges
 Scotland’s people
 Looking to the Future
Economic Recession to Recovery (1)
The ‘great recession’ was the longest and deepest recession in the UK since the 1930s both in terms of depth of
recession and time to recover GDP. The UK posted the slowest recovery of any advanced economy (aside
from Italy and Greece) with recovery only taking hold after pause to fiscal consolidation in 2012 and consumer
spending and investment. Scotland’s recession was shallower than the UK. Different sectors had different rates
of recovery.
Recession and Recovery in Scotland
Output
Source: Adapted from Fraser of Allander. March 2016
Productivity (2)
Moderated growth in the international economy and Scotland and poor productivity growth presents
challenging conditions for many sectors and industries.
Productivity in Scotland
 UK trails G7 advanced economies on productivity by 18 percentage points.
Scotland trails UK.
 UK trails US productivity across all sectors, especially manufacturing.
 There is evidence that the UK manufacturing productivity in line with France/
Germany.
 But significant deterioration versus Europe in financial services and private
service sector.
 Productivity improvements have been muted at a Scottish level over the last six
years and have fallen behind wages growth. This suggests a weakening of
Scotland’s competitive advantage.
 Fraser of Allander Institute argue that total factor productivity in Scotland is much
lower than UK. In the absence of faster Scottish population growth, sustained
economic growth will require raising competitiveness.
Employment (3)
Total employment in Scotland continued to fall until 2012, but has risen sharply since then. Total employment in
2015 was 1.5% greater than in 2009, although this is compared to a 7% increase in the UK. This has been
dominated by private sector growth alongside a fall in public sector employment.
Jobs in Scotland
Employment 2009-2015
Source: Business Register and Employment Survey, 2009-2015
Non Standard Jobs (4)
Although Scotland is experiencing a growth in total employment since pre-recession times, a large part of this is
due to the rise of ‘non standard jobs’ – part time, temporary and self employment. Of the new jobs created since
the recovery, 50,000+ have been part time jobs, 35,000+ have been self-employed jobs and more than 13,000
have been temporary jobs. Only 9,000 or so have been full time jobs.
The Rise of Non-Standard Work
Employment change in Scotland and the UK, 2008 – 2015
Source: Labour Force Survey
Occupational Change (5)
The occupational shift has seen a polarisation of employment with a strong bias towards higher skilled
occupations. In effect, what we are seeing is an hour glass labour market. This represents significant
challenges for progression.
Occupational Shifts
Source: 2011 Census, Labour Force Survey, Oxford Economics
In-Work Poverty (6)
Historically, being in work was seen as a way of escaping poverty, however more recently this is not the case for
all. In 2014/15 , 260,000 people or 55% of working age adults living in poverty were living in households where
at least one adult was working, before housing costs (BHC). In 2014/15, 350,000 people or 58% of working age
adults living in poverty were living in households where at least one adult was working, after housing costs
(AHC). In-work poverty can be a particular challenge for some groups – women, younger people, older workers,
those with no qualifications, some ethnic groups, lone parents and people with disabilities.
Low Pay and in-work Poverty
In-work poverty (relative poverty AHC) in Scotland: 1998/99 to 2014/15 Number of individuals in
poverty in households with at least one adult in employment
Source:HBAI dataset, DWP
Skills Challenges (7)
Current Skills Challenges in Scotland (From Employer Skills Survey 2015)
 Steep rise in vacancies from 54,000 (2013) to 74,000 (2015) – reflecting higher
demand for labour
 Proportion of establishments reporting Skills Shortage Vacancies in Scotland rose
from 3% (2011) to 4% (2013) and 6% (2015) – in line with UK trends
 Proportion of establishments reporting skills gaps fell to 14% (2015) – same as at
UK level
 Increasing levels of under-employment and under-utilisation of skills – 32% of
establishments reported at least one member of staff with both skills and
qualifications above the level required for the job
 Skills shortages and recruitment difficulties are likely to be a permanent feature of
the Scottish labour market, particularly where experienced labour is required
 Along with under-employment and under-utilisation of skills, this will make
improving productivity a challenging task
Scotland’s People (8)
There have been strong population increases in Scotland, driven by in migration. The population is, however, an
ageing one, with changing age demographics. This means there is considerable competition for young people.
The majority of people in the workforce over the next 10 years are already working.
People and Demographics
Source: Mid Year Population Estimates
The Future - Scotland’s People (9.1)
Over the period 2012-2037, the population of Scotland is forecast to grow by 9% to reach just under 5.8 million
by 2037. The ageing of the population is forecast to continue however with the highest percentage of growth
forecast in those age groups 65-74 and 75+.
Population Projections
Source: General Register Office for Scotland
The Future – GVA (9.2)
GVA for Scotland is forecast to steadily increase over the period 2015-2024.
Looking Forward – GVA for Scotland
Source: ONS, Oxford Economics
The Future – Employment (9.3)
Although employment is forecast to contract between 2016-2019, this will be followed by growth from 20192024. In 2024, this would be equivalent to just under 47,500 additional jobs in the economy compared to 2015
levels.
Looking Forward - Employment
Source: BRES, ONS workforce jobs, Oxford Economics
The Future – Employment by Industry (9.4)
Not all industrial sectors will fare the same in terms of employment growth. It is forecast that there will be growth
in Construction, Professional, scientific and technical activities and Administrative and Support Services whereas
there will be a major decline in Manufacturing, Mining and Quarrying and Public sector jobs.
Looking Forward - Employment
Source: BRES, ONS workforce jobs, Oxford Economics
The Future – Total Jobs Requirement (9.5)
Although understanding growth is important, a crucial part of skills planning is being able to understand the likely
jobs that will arise as a result of both expansion demand (growth/contraction) and also replacement demand
(churn in the labour market). Total jobs forecast to be filled in the period 2016-2024 is 980,600 with most of
these arising due to replacement demand and a very small proportion (c.26.5k) arising from growth.
Looking Forward – Total Jobs requirement
Total jobs requirement from 2016-2024
Source: Oxford Economics
The Future – Qualifications (9.6)
Based on the total jobs requirement for 2015-2024, the forecast for qualifications required shows that the vast
majority of requirement is for people qualified at higher level - SCQF7 and above. Only a small proportion of
opportunities will be available for people with no-low qualifications.
Looking Forward - Qualifications
Source: Oxford Economics
4. Aberdeen City & Shire
in Context
The context within which a region operates plays a huge part in explaining a region’s
performance. Historical factors, the composition of the industrial sector, geographic location,
image and demographics are all at play. It is important to provide the regional context before
presenting demand and skills supply data.
In this section:
 Aberdeen City & Shire’s contribution to
Scotland’s economy
 Key sectoral characteristics
 Key labour market performance
 Deprivation and living standards
 Earnings and Commuting Patterns
 Aberdeen City & Shire Region SIP/Investment
Aberdeen City & Shire Region in Context (1)
The Aberdeen City and Shire region has been a successful regional economy contributing considerable
wealth to the Scottish economy, based around the oil and gas sector. To 2014, the region contributed some
£16,559m to the Scotland economy, 13.9% of the total, a similar proportion to 2012 and 2013 following more
than a decade of output growth. The recent downturn in the oil and gas sector is expected to show in the
2015 output data when this becomes available. For more on GVA see Section 5: Economic Performance.
Aberdeen City & Shire Region’s Contribution to Scotland’s Economy
Total GVA in the region 2004-2014 and the region’s share of total Scotland GVA
Source: Oxford Economics
Aberdeen City & Shire Region in Context (2)
The historic strength of the oil and gas sector is reflecting in the 21% of all regional output coming from the
mining and quarrying industrial sector. The sector supports a large service economy and the professional,
scientific and technical activity sector is the next largest in terms of output, more than twice the Scotland
average. For more on GVA see Section 5: Economic Performance.
Industrial Structure of Aberdeen City & Shire Region (GVA by sector) 2014
Total GVA (£m) at 2013 prices
Source: Oxford Economics forecasts
Aberdeen City & Shire Region in Context (3)
There were 288,100 employed in the Aberdeen City & Shire region in 2015, tellingly 11,500 fewer than in
2014 as the effects of the oil and gas sector downturn feed through into employment statistics. This
represented a 4% decline, and was the first fall in employment since the recession. Job losses have
continued in 2016. These are people employed in VAT or PAYE-registered businesses and so excludes
those who are self-employed and work for smaller firms.. See Section 7 on Where are the Jobs and Section
9 on the Labour Market.
Key Labour Market Performance
Employment change 2009-2015 Aberdeen City
and Shire region, Scotland and Great Britain
Source: Business Register Employment Survey
Employment change 2009-2015 Aberdeen City &
Shire region, Scotland and Great Britain
Aberdeen City & Shire Region in Context (4)
The number of datazones in the most deprived 10% in Scotland has reduced considerably over the 10 years
since 2006. Although there remain concentrations of deprivation in Aberdeen City and parts of
Aberdeenshire, overall the region has performed well economically. This picture may start to change with the
job losses in oil and gas, but it is too soon to say whether deprivation levels will rise. Household incomes in
the region are well above average, with 26% of Aberdeen City and 30% of Shire households with earning
above 40,000, well above the national average of 18%.
Deprivation and Living Standards
Source: Scottish Index of Multiple Deprivation
Source: Scottish Household Survey
Fewer Aberdeen City and Shire households have lower
incomes than the Scotland average.
Aberdeen City & Shire Region in Context (5)
Aberdeen City is the focus of the majority of jobs within the region, and many from Aberdeenshire commute
into the City. Some 40% of those in Aberdeenshire commute into the City. By contrast, the vast majority of
those in Aberdeen City work there. Few in the region work outside the region. More information is at Section
8: The People of the Aberdeen City & Shire region.
Commuting Flows
At the time of the 2011 Census,
more than 40,000 in Aberdeenshire
travelled into Aberdeen City for
employment.
Source: 2011 Census
Aberdeen City & Shire in Context (6)
Aberdeen City and Shire Regional Skills Strategy (2016)
 SDS has been working with partners including NESCOL, University of Aberdeen,
Robert Gordon University, Aberdeen City Council, Aberdeenshire Council,
Aberdeen and Grampian Chamber of Commerce, Opportunity North East and
Scottish Enterprise to develop a Regional Skills Strategy
 The strategy sets out a concerted programme of action around four key themes




Responding to the downturn
Supporting economic transition
Repositioning the skills system
School to work transitions
 A detailed action plan is being completed by partners and the Strategy will be
published early in 2017
5. Aberdeen City & Shire:
Economic Performance
The economic performance of the region is a critical driver of the demand for skills. Successful
businesses need high levels of productivity, with skills an important component of this,
although not the only one, particularly as business processes become more mechanised.
Economic performance is measured using Gross Value Added per worker as the best measure
of productivity.
In this section:
 Total GVA and GVA growth rates
 GVA per employee (productivity)
 GVA per employee by sector
 Forecast GVA growth
Economic Performance (1)
Total GVA in the Aberdeen City and Shire region has increased each year between 2010 and 2014,
and the increase 2013-2014, at 4.1% was close to the national increase. Output had been rising
sharply pre-recession, although output fell in 2009 as it did across Scotland. The recent downturn in
the oil and gas sector are not yet reflected in GVA data.
Total GVA in the Aberdeen City and Aberdeenshire Region (2004-2014)
Source: Oxford Economics
Total GVA £m at 2013 prices
Economic Performance (2)
GVA per worker is a proxy measure for productivity. It describes the region’s output in relation to the
numbers in employment. Again this is heavily influenced by the sector composition of the regional
economy. Sectors such as oil and gas and professional, scientific and technical services are typically
more productive than others, with Aberdeen City and Shire having a greater share of these sectors
than the rest of the region. The GVA per worker in Aberdeen City since the recession has increased
and at a rate well above the Scotland average.
GVA Per Employee (Productivity)
Source: Oxford Economics
Economic Performance (3)
GVA output is forecast to grow in the Aberdeen City and Shire region, although at a rate no greater
than the Scotland average. Growth of 15.3% is forecast 2015 to 2024, compared to 15.9% for
Scotland. The fall in oil prices which has caused job losses in the oil and gas sector and its supply
chain means growth of just 0.1% is predicted for 2016. Further, uncertainty caused by the UK’s
decision to leave the EU has dampened near-term growth prospects.
GVA Output Growth to 2024
Source: Oxford Economics
Economic Performance (4)
Growth in Aberdeen City and Shire’s economy is set to be heavily underpinned by growth in the
professional services industry. Professional services will contribute around twice as much to total GVA
growth as the next closest sector, wholesale and retail. Information and communications is expected to
enjoy the fastest rate of growth (average 3.5% per year), followed closely by administrative and
support services (3.5% per year) and professional, scientific and technical services (3.4% per year).
.
Forecast Output Growth by Sector
6. Aberdeen City & Shire:
Business Base
The business base of the region is a strong determinant of the economic performance
described in the previous section. Successful businesses need skilled and effective
employees. This section presents an analysis of the business base by its industrial sector
composition and other characteristics.
In this section:
 Total number of businesses and growth rates
 Business base by sector
 Growth sector businesses
 Business base by size
 Business density
 Business birth, death and survival rates
 Self employment
Business Base (1)
There were 23,320 VAT and PAYE registered businesses in the Aberdeen City and Shire region in 2015.
The rate of growth in the region’s business base has been slower than the Scotland average since 2013.
The growth rate from 2014 to 2015 was 4.9% compared to 7.3% for Scotland and this was the first time
since 2010 that the rate of increase was lower than that for Scotland.
Total Number of Businesses and Growth Rates 2010-2015
Number of businesses by year from 2010 –
and growth rate comparators
Change in number of business 2010-2015
24,000
23,000
22,000
Insert
chart from ekosgen
21,000
20,000
19,000
18,000
17,000
16,000
15,000
2010
2011
2012
2013
2014
2015
Source: UK Business Counts
Aberdeen and Aberdeenshire
Source: UK Business Counts
Scotland index
Business Base (2)
More than one in three businesses in Aberdeen City and Shire (34%) are in the professional, scientific and
technical sector. This is almost double the proportion across Scotland. 13% of businesses are in the
agricultural, forestry and fishing sector, reflecting that much of Aberdeenshire is rural, although most of these
businesses will be very small.
Business Base by Sector, 2015
Source: UK Business Counts
Business Base (3)
The Government Economic Strategy identifies six growth sectors, detailed below. Almost six in 10
businesses in the region are in on of these identified growth sectors. A greater proportion of Aberdeen
City and Shire region growth sector businesses are in energy (12% versus 5% for Scotland) and in
finance and business services (43% versus 36%). The definition of the growth sectors can be found in
Appendix 1.
Growth Sectors
Number of businesses by growth sector 2015 – and
proportion of all growth sector businesses
Scottish Government Growth Sectors Database
Growth sector businesses as a
proportion of all business, 2015
Business Base (4)
The strength of the energy sector, which is dominated by oil and gas, is demonstrated by the fact that
the sector accounts for 84% of the region’s growth sector GVA. The financial and business services
sector accounts for a further 9% of total growth sector GVA..
Growth Sector Total GVA (£m), 2013
Growth sector total GVA as a % of all growth
sector GVA, 2013
Source: Scottish Government Growth Sectors Database
Total GVA (£m) at basic prices of Scottish Government
Growth Sectors by sector, 2013
Some figures are supressed due to data being disclosive
Business Base (5)
The Aberdeen City & Shire region has a large proportion of micro-businesses (employing fewer than 10
people), which is particularly the case in more rural Aberdeenshire. There are 100 large employers in the
region (employing 250 or more). Business density in the region is 474 per 10,000 compared to 313 per
10,000 in Scotland, reflecting higher numbers self-employed in the agriculture, forestry and fishing sector,
but also the recent strength of the regional economy (at least prior to the oil and gas sector downturn).
Business by Size, 2015
Number of businesses by employee size band and
by proportion of all businesses, 2015
Source: UK Business Counts
Business Density, 2015
###
Business Base (6)
Business survival rates in the Aberdeen City & Shire region are higher than for Scotland and Great Britain.
In all, 56% of businesses starting in 2010 in the region had survived until 2014, compared to 48% across
both Scotland and Great Britain. The business birth rate has consistently been above the Scottish average,
although in 2014 the business birth rate dropped below the Great Britain rate.
Business Birth and Death Rates (2004-14) and Survival Rates (2010-14)
Source: ONS Business Demography
and Mid-year Population Estimates
Business Base (7)
Self employment rates in the Aberdeen City & Shire region have fallen since 2011, partly as a result of the
rise in employees in employment as the economy has performed well. This may start to change given the
current difficulties facing oil and gas sector businesses. Self employment rates are the proportion of the
resident working age (16-64) population who are self employed.
Self Employment
Source: Annual Population Survey – Jan-Dec each
year
7. Aberdeen City & Shire:
Where are the Jobs?
Analysing the employment base of the region provides important information on the nature and
functioning of the labour market. There have been significant occupational shifts in Scotland,
reflected in changes in the Aberdeen City & Shire region, where higher skilled occupation
employment continues to increase. There has been jobs recovery since the recession, but not
all of these have been good quality jobs.
In this section:
 Total employment and rate of change
 Employment by sector and change over time
 Sectoral specialism
 Employment by occupation and change
 Non standard jobs – part time and non
permanent
 Resident and workplace earnings
Where are the Jobs (1)
In 2015, the latest data available, there were 288,100 employees in VAT and PAYE registered businesses
in the Aberdeen City & Shire region. This is a 3% fall from 2014 and a loss of 11,500 jobs. Redundancies in
the oil and gas sector account for these losses, which in turn may affect supply chain and related service
sector employment. The fall in employment followed strong jobs growth from 2010 to 2014.
Total Employment and Change 2009-2015
Source: Business Register and Employment Survey
Where are the Jobs (2)
Employment by sector provides important information on the industrial composition of the regional
economy. Employment in the production sector (which includes oil and gas) still comprises the largest
share employment at 20% of the total, some 59,000 jobs. The professional, scientific and technical sector is
also well represented, twice the proportion for Scotland. Although agriculture, forestry and fishing represents
a large number of businesses, this is only 1% of employees in employment.
Employment by Sector and Proportion of Total Employment 2015
Source: Business Register and Employment Survey
Where are the Jobs (3)
Marrying employment growth trends by sector with the size and concentration of the sector in a region
can provide important information on the dynamics of the labour market. Concentration of a sector is the
extent to which employment in the sector is above (or below) sector concentration at the Scotland level.
Sector Specialisms
Sectors above the horizontal
line are more concentrated in
the region than in Scotland,
those below the line less so.
Sectors to the right of the
vertical line are larger in
employment terms than five
years ago, to the left less so.
Larger bubbles reflect higher
sector employment.
The large and concentrated
production and professional,
scientific and technical
sectors are illustrated right.
The financial and insurance
and information and
communication sectors are
less concentrated and have
declined in size in the last
five years.
Note: SIC Section A: Agriculture, Forestry and Fishing omitted as data for farm
agriculture (SIC subclass 01000) is not available sub-nationally
Where are the Jobs (4)
The occupational profile of the region is important because occupation is often linked to skills requirements.
There has been a steady and continuing shift to more professional occupations. In Aberdeen City & Shire
almost one in four residents work in professional occupations (23%), higher than the Scotland and Great
Britain averages. A further 13% work in associate professional and technical occupations. The proportion
occupied in skilled trades remains high and above the Scotland average, linked to the production sector and
also construction. Fewer are occupied in the caring and other service sector, which is a challenge for the
region, given an ageing demographic and – until recently – strong competition for labour.
Employment by Occupation (2015)
Change Over Time 2005-2015
Source: Annual Population Survey
Source: Annual Population Survey
Where are the Jobs (5)
Just over a quarter (26%) of those in employment work part-time and this is the same proportion as
Scotland and Great Britain. The proportion working part-time was above average in 2010 and 2012 but
had fallen to below average in 2013-2014. More of the jobs created in the economic recovery have been
part time jobs. A lower proportion than Scotland and UK averages are in non-permanent employment,
which is linked to the success of the regional economy until the recent oil and gas sector difficulties.
Part Time Employment
2005-2015
Source: Annual Population Survey
Non-Permanent Employment, 2011-2015
Non-permanent
employment is the
proportion of all of
those of working
age in employment
types such as fixedterm contracts,
temporary agency,
casual or seasonal
work. The increase
in non-permanent
employment reflects
the changing nature
of employment.
Source: Annual
Population Survey
Where are the Jobs (6)
Some sectors are typically better paid than others, and the industrial base of the region is often an indicator
of average wage levels. The composition of the industrial base within a region also affects workplace pay
levels. Average workplace earnings in Aberdeen City are £617 for all workers, well above the Scotland
average of £492. In Aberdeenshire, however, average workplace earnings are much lower, and below the
Scotland average. By contrast, those resident in Aberdeenshire earn well above the Scottish average, close
to the average for residents in Aberdeen City, reflecting the significant levels of in-commuting from the Shire
into the City.
Average Weekly Workplace and Residence-Based Earnings, 2015
Source: Annual Survey of Hours and
Earnings
8. Aberdeen City & Shire:
Its People
The demographic characteristics of the region are extremely important in determining current
and future demand for skills. The age profile of the population, the number of young people
and elderly, the increasing proportion of retirees, are all contributory factors. The movement of
people within a region, and into and out of a region, also affect the labour market and the
supply of skills available to employers.
In this section:
 Population growth
 Population profile
 Population projections
 Net migration
 Travel to work data
People (1)
Aberdeen City and Shire’s population has grown faster than the Scotland average over the 10 years
2005 to 2015, although both lag behind the rate of growth in Great Britain of 7.8%. The population of
Aberdeen City and Shire continued to increase slightly faster than the rate over the previous year (20142015), +0.6% compared to +0.5% in Scotland.
Population Change over Time
Scotland
5,110,200
5,133,100
5,170,000
5,202,900
5,231,900
5,262,200
5,299,900
5,313,600
5,327,700
5,347,600
5,373,000
262,800
10%
5%
Source: Mid-Year Population Estimates
Population Change (Indexed)
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
Change 2005-15
% Change 200515
Index of Population Change, 2005-15
Aberdeen City
and Shire
446,260
450,800
456,850
460,860
466,040
471,160
476,110
480,470
484,840
489,450
492,310
46,050
114
112
110
108
106
104
102
100
98
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Year
Aberdeen and Aberdeenshire
Scotland
Great Britain
People (2)
Aberdeen City and Sire has a younger age profile than the Scotland average. This is driven by growth of
the 25-34 age band since 2005 (+25%, 13,900) compared to Scotland ( +12%.) The region has also
seen a lower decline in the 35-44 age band than Scotland (-5% versus -16%.) However, it has seen
higher growth of the 65+ age band (+19%, 13,100) than Scotland (+18%). Overall, the working age
population of the region increased by 29,600 over the 10 years to 2015.
Age profile of the Region
Age Profile, 2015
Population Change by Age, 2005 2015
15%
% Change
% of Population
20%
10%
5%
0%
0-15 16-19 20-24 25-34 35-44 45-54 55-64 65+
Age
Aberdeen and Aberdeenshire
Scotland
35%
30%
25%
20%
15%
10%
5%
0%
-5%
-10%
-15%
-20%
0-15 16-1920-2425-3435-4445-5455-64 65+
Age Band
Aberdeen and Aberdeenshire
Scotland
People (3)
Population Projections (2014-2037)
81,201
434,251
21%
8%
Population Projections, by Age, 2014 - 2037
100%
80%
% Change
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
Change
2014-2037
% Change
2014-2037
Aberdeen City
and Shire
Scotland
488,036
5,346,120
492,115
5,365,420
496,286
5,385,719
500,648
5,406,997
505,159
5,429,012
509,724
5,451,660
514,325
5,474,391
518,952
5,497,079
523,602
5,519,588
528,251
5,541,816
532,878
5,563,670
537,479
5,585,040
542,052
5,605,814
546,581
5,625,892
551,040
5,645,150
555,447
5,663,541
559,793
5,681,121
564,072
5,697,808
568,287
5,713,523
572,422
5,728,318
576,515
5,742,297
580,559
5,755,558
584,590
5,768,217
588,601
5,780,371
60%
40%
20%
0%
-20%
0-15
16-29
30-49
50-64
65-74
75+
Total
Age Band
Aberdeen and Aberdeenshire
Scotland

Aberdeen City and Shire’s population is projected to
grow more quickly than in Scotland as a whole to 2037
(+21% compared to +8%).

The working age population is also projected to grow
compared to a national fall (+11% compared to -4%).

Over the longer term, the age structure of the region’s
population is projected to become older, with a higher
rate of 65+ projected than Scotland
People (4)
There has been variable net migration into Aberdeen City and Shire in recent years. Between 2010/11 and
2011/12, net migration decreased from 4,462 to 3,233, before increasing slightly between 2011/12 and
2013/14 to 3,453. Between 2013/14 and 2014/15 net migration decreased sharply to 2,071. The age band
with the highest net migration in 2014/2015 was 15-24 (1,779), partly reflecting the region’s age profile and
its attractiveness as a place to work and study.
Net Migration
Net Migration, 2004/05 - 2014/15
Net Migration, by Age, 2014/15
5,000
2000
4,000
1500
Net Migration
No of Migrants
6,000
3,000
2,000
1,000
0
1000
500
0
-500
-1000
Year
Aberdeen and Aberdeenshire
Source: National Records of Scotland
0-14 15-24 25-34 35-44 45-54 55-64 65+
Age Band
Aberdeen and Aberdeenshire
Source: National Records of Scotland
People (5)
There are significant levels of out-commuting from Aberdeenshire into Aberdeen City, which reflects that
Aberdeen City is the major regional employment centre. 40% of those employed and living in
Aberdeenshire work in Aberdeen City, which reflects a significant level of out commuting. Aberdeen City is
the most self-contained labour market, with 90% of those employed working locally.
Travel to Work (2011 Census)
Travel to Work, Location (2011 Census)
Area
Aberdeenshire
Aberdeen City
Aberdeen and Aberdeenshire
0%
Works in home area
10%
20%
30%
40%
50%
60%
Percentage
Works in the rest of the region
70%
80%
Works outside the region
Please note, location of employment figures exclude those working outside the UK, on offshore installations or
with no fixed place of work
90%
100%
People (6)
The workplace population of Aberdeen City at the time of the last Census was 140, 815, and of these
workers, 63% were resident in the City (89,223). A lesser number of Aberdeen City workers were
commuting from elsewhere in Scotland into the City (48,087). Overall, there was a net flow of workers to
Aberdeen City of 39,011. By contrast, there were more than 43,000 workers in who commuted out of their
local authority area to work.
Travel to Work (2011 Census)
Inflow of workers number
Works in
the area
but lives
Total
Lives and elsewhere
Council area of workplace works in in
workplace
population the area Scotland
Outflow of workers number
Lives in
Works in the area
the area but works
but lives in elsewhere
the rest of in
UK
Scotland
Net flow of workers
Lives in
the area
but works
in the rest Within
of the UK Scotland
From the
rest of the
UK
Total
Aberdeen City
140,815
89,223
48,087
3,505
9,076
311
39,011
3,194
42,205
Aberdeenshire
70,873
57,873
12,125
875
43,475
468
-31,350
407
-30,943
Note: Currently not available in the Data Matrix
Please note, location of employment figures exclude those working outside the UK, on offshore installations or
with no fixed place of work
9. Aberdeen City & Shire:
Labour Market
The functioning of the labour market is influenced by labour market participation. Those
unemployed or economically inactive will not be directly contributing to the economic success
of the region, although their situation may be temporary, or indeed those inactive may be
learning and studying and be a future contributor to the region.
In this section:
 Age composition of workforce
 Economic activity
 Qualifications
 Participation
 Unemployment
Labour Market (1)
Aberdeen City and Shire’s economic activity and inactivity rates have remained relatively stable between
2005 and 2015, between 81% and 84% for activity and 15% - 18% for inactivity, both better than
Scotland’s rates. The best levels (81% and 15%) were reached in 2010. Scotland’s rates have remained
stable throughout, staying at 77-78% and 22-23% respectively.
Economic Activity Rates
Economic Inactivity Rates
Economic Inactivity Rate, 2005-15
100%
95%
90%
85%
80%
75%
70%
65%
60%
Aberdeen and Aberdeenshire
Source: Annual Population Survey
20%
15%
10%
5%
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
0%
2005
Year
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
Inactivity Rate
25%
2005
Percentage
Economic Activity Rate, 2005-15
Year
Scotland
Aberdeen and Aberdeenshire
Source: Annual Population Survey
Scotland
Labour Market (2)
The highest level qualifications of the resident working age population is a useful barometer of skills
attainment levels. There remains a cohort in regional economies with no formal qualifications which used to
be associated with older workers. Jobs increasingly require higher levels of qualification, including so-called
entry level jobs. The increasingly qualified working age population in Aberdeen City and Shire is illustrated,
with 47% now qualified to SCQF Level 7-12, compared to 43% for Scotland. There is a lower proportion of
the working age population with no qualifications, 5% compared to the Scotland average of 9%.
Qualifications
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Qualification Level, 16-24, 2015
Percentage
Percentage
Qualification Level: 16-64, 2015
Aberdeen and Aberdeenshire
Source: Annual Population Survey
Scotland
35%
30%
25%
20%
15%
10%
5%
0%
Aberdeen and Aberdeenshire
Source: Annual Population Survey
Scotland
Labour Market (3)
The Participation Measure is a new measure which provides the ability to identify the status of the wider 1619 cohort – not just those who have left school. Participation of young people aged 16-19 in Aberdeen City
and Shire was higher (92%) than the Scottish rate of 90%.
Participation
Aberdeen City and
Shire
Number
Participation Measure, 2016
18,323
16,778
12,751
3,798
92%
70%
21%
90%
71%
17%
229
1%
2%
603
3%
4%
423
2%
3%
180
1%
1%
942
5%
6%
Source: Skills Development Scotland
Percentage
Total Cohort
(16-19)
Participating
(16-19)
Education
Employment
Other Training &
Development
Not
Participating
(16-19)
Unemployed
Seeking
Unemployed not
Seeking
Unconfirmed
Status (16-19)
Aberdeen City
and Shire Scotland
%
%
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Participating
(16-19)
Not
Unconfirmed
Participating Status (16-19)
(16-19)
Status
Aberdeen and Aberdeenshire
Scotland
Labour Market (4)
The way unemployment is measured is changing with the introduction of Universal Credit. As such, the data
is regarded as ‘experimental’ and care is needed when comparing to previous data (all regions have
recorded a fall in claimant count unemployment under the new measure).
Unemployment – Claimant Count (includes Universal Credit) – experimental
measure
Source: Job Seekers Allowance
Scotland
12,760
13,265
12,490
7,825
10,320
20,870
20,340
35,725
38,090
29,470
19,145
16,515
Great
Britain
115,375
141,970
145,310
99,735
123,545
252,170
203,195
378,480
410,710
310,865
197,275
158,520
Out of Work Claimants (Index), 200516
Claimants (Indexed)
May 2005
May 2006
May 2007
May 2008
May 2009
May 2010
May 2011
May 2012
May 2013
May 2014
May 2015
May 2016
Aberdeen City and
Shire
470
415
350
185
285
435
590
1,100
965
605
340
565
350
300
250
200
150
100
50
0
Year
Aberdeen and Aberdeenshire
Scotland
10. Aberdeen City & Shire:
Skills Challenges
Employers can have difficulties accessing the skills they need, skills deficiencies can be
amongst those they are seeking to recruit and amongst those in their existing workforce. Skills
shortage vacancies (SSVs) relate to the skills shortages amongst those being recruited, and
skills gaps are a deficit within the existing workforce. The 2015 UKCES Employer Skills Survey
provides timely data in relation to these and other issues.
In this section:
 Skills shortages
 Skills gaps
 Recruitment activity
 Skills under-utilisation
Skills Challenges (1)
The UKCES Employer Skills Survey 2015 indicated that across Aberdeen City and Shire skills shortage
vacancies were in line with Scotland at 0.8%. Hard-to-fill vacancies due to skills shortages accounted for
1.2% of the workforce, compared to 1.1% across Scotland as a whole. In all, 8% of establishments in
Aberdeen City and Shire reported at least one hard to fill vacancy, this was higher than the 6% across
Scotland.
Skills Shortages
Scotland
1.2%
1.1%
1.4%
0.8%
0.8%
1.2%
Skills Shortage and Hard to Fill
Vacancies, 2015
Percentage
Hard to fill vacancies as %
of workforce
Skills shortage vacancies
as % of workforce
Source: UKCES
Aberdeen City
and Shire
Hard to fill
vacancies
as % of
workforce
1.0%
0.8%
0.6%
0.4%
0.2%
0.0%
Aberdeen and
Scotland
Aberdeenshire
Area
Skills
shortage
vacancies
as % of
workforce
Skills Challenges (2)
Skills gaps occur when employers think their employees lack some of the skills required to be fully proficient
at their job. Around 7% of the workforce in Aberdeen City and Shire had a skills gaps compared to 5%
nationally. Aberdeen City and Shire businesses reported more skills gaps than the Scottish average.
 Skills gaps particularly prevalent in sales and customer services staff in Aberdeen City and Shire
 65% of employers with a skills gaps say there is an impact on the business (70% nationally)
Skills Gaps
Density of Skills Gaps, by
Occupation, 2015
16%
14%
12%
10%
8%
6%
4%
2%
0%
Occupation
Percentage
Skills Gaps, 2015
Aberdeen and
Aberdeenshire
Scotland
Elementary staff
Machine operatives
Sales & customer…
Caring, leisure & other…
Skilled trades occupations
Administrative/clerical staff
Associate professionals
Professionals
Managers
Area
0%
5%
10%
Percentage
% establishments with a skills gap
% workforce with a skills gap
Source: UKCES
Scotland
Aberdeen and Aberdeenshire
15%
Skills Challenges (3)
Overall, 52% of Aberdeen City and Shire businesses had recruited staff in the year prior to the 2015
UKCES survey, this was in line with the national average. The number of vacancies was below the Scottish
average with 17% of employers in Aberdeen City and Shire having at least one vacancy. In addition, 31% of
employers in Aberdeen City and Shire have staff who are under-utilised, which is slightly lower than the
national average.
Recruitment Challenges
Skills Under-utilisation
Vacancies, 2015
Skills Under Utilisation, 2015
40%
6%
5%
Have at least one
vacancy that is hard to
fill
35%
31%
32%
Aberdeen and
Aberdeenshire
Scotland
30%
Percentage
Type of Vacancy
Have a skills shortage
vacancy
8%
8%
25%
20%
15%
10%
19%
17%
Have at least one
vacancy
5%
0%
0%
Scotland
Source: UKCES
5% 10% 15% 20%
Percentage
Aberdeen and Aberdeenshire
Area
% of employers with staff who are under-utilised
11. Aberdeen City & Shire:
Schools Data
The number of young people at school and projected school roll numbers are important as
those at school will form part of the future labour market. The destination of those leaving
school also has an impact on the labour market, as young people might enter employment,
education and training, or none of these after school.
In this section:
 School roll numbers
 School roll projections
 School leaver destinations
Schools Data (1)
There were 23,026 secondary school pupils in Aberdeen City and Shire in 2015. The region had slightly
lower proportions of S6 pupils (10% v 12%) than Scotland. There were higher proportions of S2 and S4
pupils in Aberdeen City and Shire than Scotland (both 19% v 18%)
Secondary School Roll Numbers and by Year Group
Source: Scottish Government Pupil Census
50,813
49,514
50,197
51,078
45,817
33,936
281,355
% School Roll Numbers for
Secondary School Pupils, 2015
18%18%
19%
19%
18% 18% 18%
18%
School Roll Numbers (%)
S1
S2
S3
S4
S5
S6
Total Pupils
Aberdeen City and
Shire
Scotland
4,213
4,315
4,124
4,331
3,677
2,366
23,026
16%16%
12%
10%
S1
S2
S3
S4
School Year
Aberdeen and Aberdeenshire
S5
S6
Scotland
Schools Data (2)
Based on the latest available projections (2012), secondary school roll numbers in Aberdeen City and Shire
are projected to increase by 3% up to 2018. This is compared to a 2% drop in numbers for Scotland in the
same period of time.
Secondary School Roll Number Projections
2014
2015
2016
2017
2018
Aberdeen City and Shire
22,800
22,500
22,400
22,600
23,000
Source: Scottish Government Pupil Projections
Scotland
282,800
278,000
275,300
275,100
277,900
Index of Projected School Roll
Numbers for Secondary School
Pupils, 2014-18
102
100
98
96
94
92
90
2014
2015
2016
Year
Aberdeen and Aberdeenshire
2017
2018
Scotland
Schools Data (3)
From 2013/14 to 2014/15, Aberdeen City and Shire had a one percentage point increase in school leavers
entering a positive destination. More school leavers in the region entered a positive destination compared to
the national average. The proportion of Aberdeen City and Shire leavers entering Higher Education
increased by one percentage point between 2013/14 and 2014/15; this was in contrast to a two percentage
point decline across Scotland.
School Leaver Destinations
2013/14
2014/15
Aberdeen City
Aberdeen City
and Shire
Scotland and Shire
Scotland
93%
92%
94%
92%
37%
39%
38%
37%
23%
1%
31%
24%
3%
25%
26%
1%
28%
23%
3%
28%
0%
0%
0%
1%
1%
1%
0%
1%
5%
7%
5%
6%
1%
0%
2%
0%
1%
1%
2%
1%
Source: Scottish Government School Leaver Destinations
Dataset
Destination
Positive
Destination
Higher
Education
Further
Education
Training
Employment
Voluntary
Work
Activity
Agreement
Unemployed
Seeking
Unemployed
Non-Seeking
Unknown
School Leaver Destinations,
2014/15
Unknown
Unemployed Non-…
Unemployed Seeking
Activity Agreement
Voluntary Work
Employment
Training
Further Education
Higher Education
0% 10% 20% 30% 40% 50%
Percentage
Scotland
Aberdeen and Aberdeenshire
12. Aberdeen City & Shire:
Skills Provision
There is a wide variety of skills and learning provision available which is designed to meet the
future skills needs of the economy. Amongst this is the provision commissioned by Skills
Development Scotland, notably via the Apprenticeship family of products (Modern
Apprenticeships, Foundation Apprenticeships and Graduate Level Apprenticeships) and the
Employability Fund and delivered by approved training providers including Colleges,
Universities and Private training providers.
In this section:
 Modern Apprenticeships by participant
characteristic and framework grouping
 Foundation Apprenticeships
 Graduate Level Apprenticeships
 Employability Fund and Certificate of Work
Readiness starts
Skills Provision (1)
Modern Apprenticeships (MA) help employers to develop their workforce by training new and
existing employees. For individuals, an MA lets them earn a wage while gaining a qualification. MA
uptake in the region and nationally was at a peak in 2011/12. The number of MAs in Aberdeen City
and Shire has since decreased annually to 2015/16. In Aberdeen City and Shire, 52% of
apprentices were aged 16-19, slightly higher than the national picture (50%).
MA Total Number of Starts
MA Starts 2015/16, by Age
100%
80%
60%
Age 25+
Age 20-24
40%
Age 16 -19
20%
0%
Aberdeen and
Aberdeenshire
Scotland
Skills Provision (2)
The gender divide in MA uptake in Aberdeen City and Shire was slightly wider than the national picture over
the period 2010/11 to 2014/15, however in 2015/16 when the region had greater MA uptake from female
participants than the national picture. In 2015/16 the representation of disabled individuals in MAs across
Scotland remained low, 4% of individuals starting an MA had a disability however 19% of the working age
population in Scotland had a disability.
MA Starts by Gender 2010-2016
MA Starts 2015-16 by Disability
100%
100%
80%
90%
80%
60%
70%
40%
No
60%
20%
Aberdeen
Scotland
Aberdeen
Scotland
Aberdeen
Scotland
Aberdeen
Scotland
Aberdeen
Scotland
Aberdeen
Scotland
0%
2010/11 2011/12 2012/13 2013/14 2014/15 2015/16
Female
50%
Male
40%
Yes
30%
Prefer not to say/
Unallocated
20%
10%
0%
Aberdeen and
Aberdeenshire
Scotland
Skills Provision (3)
The uptake of MAs in the Aberdeen City and Shire Region had a similar mix of ethnicity to the overall
national picture. Only 1% of MAs had a Black Minority and Ethnic (BME) background. This level of
participation is well below the overall BME working population in Scotland of 3.1% (APS 2014).
MA Starts by Ethnicity 2015/16
Aberdeen City and
Shire
Scotland
Skills Provision (4)
The most popular Framework group for MAs in Aberdeen City and Shire was Construction & Related
(includes trade such as plumbing and joinery), which was also one of the most gender segregated groups
with 98% male starts. Other male dominated groups included Automotive (97%) and Engineering & Energy
related (92%). Females accounted for the greatest proportion of MAs in Personal Service (includes
hairdressing) (95%), Sport, Health & Social Care (89%) and Administration & Related (88%).
Modern Apprenticeship Starts by Framework Group and Gender
Skills Provision (5)
MA achievement rates give the proportion of MA starts who completed their apprenticeship, gaining their
target qualification and reaching work-based learning aims. Achievement rates in Aberdeen City and Shire
have been consistently below the Scottish average but have been improving over time and in 2015/16 were
at the highest rate (75%) and only one percentage point behind the national average.
MA Achievement Rates 2010/11- 2015/16
78%
76%
74%
72%
70%
Aberdeen City
and Shire
68%
Scotland
66%
64%
62%
60%
2010/11 2011/12 2012/13 2013/14 2014/15 2015/16
Skills Provision (6)
Foundation Apprenticeships (FA) were developed to help school pupils gain work experience and access
work-based learning. S4 and S5 students spend time at college or with a local employer, and complete the
FA alongside other subjects like National 5s and Highers. The qualification takes two years and can lead to
employment or further study at college or university. FAs were piloted in some regions in 2014 and
participation has grown over the past three years. The data shows uptake from the past two years and
anticipated uptake for 2016/18.
Foundation Apprenticeships, National
Uptake 2014/16-2016/18
Foundation Apprenticeships
2016+
In 2016/18, the national uptake of FAs
is expected to be over 300.
In 2016/18 there are eight frameworks
available, linked to six key sectors:
Business Skills, Civil Engineering,
Engineering, Financial Services, IT
Hardware, IT Software, Social Services
CYP, Social Services & Healthcare
SDS aims to make FAs part of every
secondary school’s offer by 2020.
Skills Provision (7)
Graduate Level Apprenticeships (GLAs) provide work-based learning opportunities up to Master’s degree
level for employees. They have been created in partnership with industry and the further and higher
education sector.
Graduate Level Apprenticeships
Future Development
GLAs are currently available in:
Over the course of 2017 the intention is to
expand the offer to include:
•
•
•
•
ICT/Digital: Software Development
ICT/Digital: IT Management for Business
Engineering: manufacturing and Design
Civil Engineering
• Business and Management SCQF Level 10
• Engineering (Instrumentation, Measurement
and Control SCQF Level 10)
• IT and Digital (Cyber Security SCQF Level
10)
• IT and Digital (Digital Media SCQF Level 10)
• Life Sciences SCQF Level 10
• Children and Young People SCQF Level 8
Skills Provision (8)
The Employability Fund (EF) supports locally delivered services that are designed to encourage
unemployed people to move towards work. SDS administers the EF on behalf of the Scottish
Government*. The uptake of EF starts in Aberdeen City and Aberdeenshire represented 3% of the
total participants in Scotland. Females accounted for proportionately fewer starts in the region
compared to the national average (23% vs. 36%).
Employability Fund Starts 2015/16, Total and by Gender
100%
90%
80%
70%
60%
50%
Female
40%
Male
30%
20%
10%
0%
Aberdeen and
Aberdeenshire
Scotland
*All data provided relates only to SDS funded activity. As other entities administer EF programme the data will
not reflect total participation
Skills Provision (8)
The Certificate of Work Readiness (CWR) addresses the challenge that young people have of
gaining work experience and workplace skills prior to entering the labour market. The CWR
provides young people with 190 hours of work experience and an assessment from an employer
to certify that they have established workplace competencies. In 2015/16, 3% of all individual
starts were from Aberdeen City and Shire. Whilst 5% of employers involved in the scheme were
located in the Aberdeen and Aberdeenshire.
Certificate of Work Readiness 2015/16, Starts and Employers
3,500
3,000
2,500
2,000
Aberdeen and
Aberdeenshire
1,500
Scotland
1,000
500
0
No of individual
starts
No of
employers
involved
13. Aberdeen City & Shire:
Jobs and skills changes
This section will outline forecasted changes in employment from 2015 to 2024, and the nature
of changing demand for qualifications in specific occupational areas. It will also consider longer
term changes in the labour market and future expansion and replacement employment
demand.
In this section:
 Forecasts demand for jobs and how these may
change
 Changing occupational and qualification
demand
 Long-term changes in the labour market
Jobs and Skills Changes (1)
Total employment (jobs) is forecast to remain relatively flat over 2016-2024, compared to 0.2% growth
each year on average across Scotland. Accommodation and food services and transportation and
storage are expected to enjoy growth of 4,400 jobs and 2,900 jobs respectively over the period 2016-24.
The financial and construction sectors are also expected to growth, creating 1,700 and 1,000 jobs.
However such gains will be offset by falling employment within the manufacturing sector and public
administration and defence. The number of jobs within manufacturing is expected to fall by almost 6,000
over the forecast., whilst those in public administration and defence are forecast to fall by over 3,000 jobs.
Forecast Demand for Jobs (2016-2024)
Total Employment Growth
Aberdeen City & Shire Employment
% annual average change
Change in total jobs (‘000s), 2016-2024
Aberdeen City & Shire
Scotland
8%
2002-2015
6%
2016-2024
4%
2%
0%
-2%
-4%
Note: chart uses total employment (jobs) rather than total employment (people).
The former figure will be higher as a person can have more than one job.
2024
2022
2020
2018
2016
2014
2012
2010
2008
2006
2004
2002
-6%
Accommodation & food servs
Transportation and storage
Financial & insurance activities
Construction
Water supply & sewerage
Electricity, gas, steam & air
Administrative & support activities
Other service activities
Real estate activities
Arts, entertainment and recreation
Profess, scientific and technical acts
Agriculture
Information and communication
Education
Wholesale and retail trade
Mining
Human health & social work
Public administration and defence
Manufacturing
Source: ONS / Oxford Economics
4.4
2.9
1.7
1.0
0.9
0.5
0.4
0.4
0.3
0.2
0.1
-0.1
-0.1
-0.1
-0.4
-0.4
-1.2
-3.2
-5.9
Jobs and Skills Changes (2)
Growth is forecast to be strongest in elementary occupations over the period 2016-2024 (1,300 people).
Growth is also forecast in caring, leisure and other service occupations (900 people), sales & customer
service occupations (700 people) and professional occupations (300 people). However, the number of
workers in process, plant and machine operatives and skilled trades occupations in Aberdeen City and Shire
is expected to fall by around 900 and 800 people respectively. Associate professional and technical
occupations and managers, directors and senior officials are also expected to fall over the forecast whilst
administrative and secretarial occupations are expected to show little change.
Forecast Changes in Occupational Demand
Aberdeen City & Shire Employment
Change in number of workers (‘000s), 2016-2024
Managers, directors & senior officials
-0.1
Professional occs
0.3
Assoc professional & technical occs
-0.4
Admin & secretarial occs
0.0
Skilled trades occs
-0.8
Caring, leisure & other service occs
0.9
Sales & customer service occs
0.7
Process, plant & machine operatives
-0.9
Elementary occs
1.3
-2
Note: chart uses total employment (people).
Source: Oxford Economics
-1
0
‘000s
1
2
Jobs and Skills Changes (3)
The majority of openings in Aberdeen City and Shire over the forecast will require individuals with higher
level qualifications, in part a reflection of the sectoral and occupational trends expected over this period.
Individuals qualified to SCQF level 7 or above will account for 60% of the 86,700 openings expected to be
created between 2016 and 2024. The remaining opportunities will mainly be for individuals qualified to
SCQF levels 5-6, equivalent to 30% of openings over the forecast period. The net requirement at these
levels, however, will be driven solely by replacement demand.
Forecast employment change by Qualification (2016-2024)
SCQF 11-12
SCQF 7-10
SCQF 6
SCQF 5
SCQF 1-4
No qualifications
Total
Expansion demand
2,100
4,300
-3,000
-700
-2,400
-600
-300
Notes:
1. table uses total requirement (people)
2. totals may vary from previous slide due to rounding within the body of the table
Source: Oxford Economics
Replacement demand
5,500
39,600
11,500
17,900
4,200
8,300
87,000
Total requirement
7,600
43,900
8,500
17,200
1,800
7,700
86,700
Jobs and Skills Changes (4)
Replacement demand will result in over 87,000 openings within Aberdeen City & Shire over the
forecast. Expansion demand is expected to fall by 400 between 2016-2024. Together with replacement
demand, this will result in 86,700 openings over this period. Openings will be highest in professional
occupations, driven by replacement demand. The total requirement for workers in elementary
occupations and sales and customer service occupations is also expected to rise significantly over the
2016-24 period in which both are expected to experience expansion and replacement demand
Forecast Demand for Jobs (2016-2024)
Occupation
Managers, directors & senior officials
Professional occs
Associate professional & technical occs
Administrative & secretarial occs
Skilled trades occs
Caring, leisure & other service occs
Sales & customer service occs
Process, plant & machine operatives
Elementary occs
Total
Expansion demand
-200
-400
-1,000
-100
-800
1,100
800
-1,200
1,400
-400
Notes:
1. table uses total requirement (people)
2. totals may vary from previous slide due to rounding within the body of the table
Source: Oxford Economics
Replacement Demand
4,400
23,000
9,300
6,500
10,700
5,100
10,000
2,300
15,800
87,100
Total Jobs Requirement
4,200
22,600
8,300
6,400
9,900
6,200
10,800
1,100
17,200
86,700
14. Aberdeen City & Shire:
What are the key implications?
The Regional Skills Assessments provide the national policy context, the national economic
picture and trends and the regional position. The regional perspective covers in some depth
the demand for skills, current and forecast, as well as skills activity in place to meet these
needs. There is a wide range of data, with further data available in the accompanying data
matrix. This final section draws out some of the key implications for improving the
performance of labour markets. These are not solutions for partners, but rather
implications from the analysis upon which skills investment planning decisions can be
made.
In this section:
 Review of the demand for skills
 Review of current skills activity to meet need
 Key implications for skills investment planning
and recommended focus for action
Aberdeen City & Shire: Headline Summary (1)
.
Key Labour Market Changes and Dynamics
 The downturn in the oil and gas sector, the driving force for regional employment
and GVA growth over recent years, is starting to show through in the economic
data. The number of jobs fell by 3% in 2015, following four years of jobs growth,
a loss of some 11,500 jobs. There have been more job losses in 2016, although
the scale of these is not yet known.
 The oil and gas downturn has resulted in 3,300 job losses directly in production,
600 in professional, scientific and technical services and 1,600 in construction.
This is already affecting services, with 900 fewer jobs in retail, and 1,800 in
business administration and support. There are also 1,500 fewer jobs in health,
although accommodation and food services jobs increased.
 There remain some 59,000 employed in production, 20% of all jobs, twice the
proportion for Scotland. There are also 39,000 employed in the professional,
scientific and technical sector, also twice the Scotland average representation.
The health sector is third largest in employment terms.
Aberdeen City & Shire: Headline Summary (2)
.
Key Labour Market Changes and Dynamics (continued)
 Although the oil and gas sector job have been the most significant, there have
also been 800 job losses in agriculture, forestry and fishing, affecting Aberdeenshire. All occupations were affected by redundancies in 2015, except for
elementary occupations (unchanged) and sales and customer services, where
employment increased.
 Professional occupations and manager/senior officials have been less affected by
job losses than associate professionals, administrative and secretarial, skills
trades, care and leisure occupations and operatives. A downturn in the oil and
gas sector has far reaching consequences across employment groups.
 The 2016 deprivation index is based on data from previous years, and so the oil
and gas sector downturn is not reflected in the data. The 2016 index shows
relative deprivation in the region falling further, from already low levels, although
there are pockets of deprivation concentrated in Aberdeen City.
 The new measure of unemployment including Universal Claimants has shown
falling claimants across Scotland and in most regions – this is not the case in
Aberdeen City and Aberdeenshire, where claimants increased by two thirds in the
year to May 2016.
Aberdeen City & Shire: Headline Summary (3)
.
Skills Challenges
 Over the 10 years to 2015, the population of the region increased by 10%,
and 2014-based projections anticipated 21% growth to 2037, two and a half
times the Scotland forecast increase. The challenges facing the oil and gas
sector, and sectors dependent on it, may dampen these projections.
 Until recently, there was a very tight regional labour market. More employers
than the Scotland average were reporting hard-to-fill vacancies, which
represented a higher than average proportion of the workforce. Skills underutilization was less commonly reported.
 The tight labour market also resulted in skills gaps in most occupations,
notably sales and customer services, and professionals. In these
occupations in particular employers reported in-work skills gaps – these will
be those most vulnerable to redundancy given the regional economic
downturn.
Aberdeen City & Shire: Headline Summary (4)
.
Skills Activity to Meet Current and Future Demand
 Work-based learning is critical to meeting skills development needs. There
were 1,961 MA Starts in 2015/2016, a reduction from the previous year and
reflecting a general fall in numbers since 2011/2012. This reflects the region’s
challenges in increasing work-based learning through MAs.
 The top five MA frameworks largely reflect the composition of the regional
economy – construction, hospitality & tourism, health and social care (with
sport), engineering & energy, retail & customer services.
 Other services including ICT professionals and financial services are
modestly represented, particularly so now given the need to diversify the
regional economy.
 There is a continuing gender imbalance in many MA frameworks and MAs
are still not commonplace in some sectors, such as the Creative Industries.
Aberdeen City & Shire: Headline Summary (5)
.
Future Trends
 There are expected to be 400 fewer jobs in the region by 2024. This belies
significant changes expected within the jobs market. Further losses are expected
in oil and gas (mining) of 10,000, whereas increases are expected in the
professional, scientific & technical services (+5,300) and administrative & support
services (+2,900).
 Despite minimal net change in overall jobs, replacement demand means that
87,000 openings are expected to 2024. Half of these will be SCQF level 7 and
above and 90% will be level 5 and above. This reaffirms the need for a strong
skills base.
 The greatest number of openings will be in elementary occupations, professional
occupations and sales, although replacement demand means there will still be
openings in all occupations.
Aberdeen City & Shire: Key Implications (1)
.
Recommended Areas of Focus
•
Responding coherently and rapidly to the employment (and people) impacts
of the economic downturn and position the region to make the most of the new
opportunities. Job losses in the oil and gas sector have been swift and significant
following the 2015 fall in global oil prices. 10,000 more jobs are forecast to go and
the region will need to compensate for these lost jobs. Diversifying the
employment base is a priority as is retaining and anchoring people, skills and work
in the region to support the economic transition and meet future opportunities.
•
Creating high quality of jobs. In diversifying the economy there must be a focus
on professional services and occupations to ensure lost higher value added jobs
are replaced. These are forecast growth sectors for Scotland.
•
Develop a culture of employer investment. Employers will need to invest and
innovate, which includes investment in skills to increase their competitiveness and
develop new markets. Skills gaps suggest there may have been a certain underinvestment in the workforce in recent years. The supply of skills must also be
available to satisfy increased and stimulated demand.
Aberdeen City & Shire: Key Implications (2)
.
Recommended Areas of Focus
•
Maintain levels of more enterprise. A key route to the creation of new jobs is to
increase the start-up rate and business density. Business birth rates have been
consistently above the Scotland average, and it will be important to sustain this.
•
The specific needs of the oil and gas sector will need to continue to be met.
There will be challenging times ahead for the sector, yet production still accounts
for almost 60,000 jobs, and skills can help to maximise sector productivity.
•
Sectorally, there is a need to meet the needs of employers (1). There are other
key sectors and occupations in the regional economy where replacement demand
is strong, including sales and administration & support services. These require
work-based learning routes into, and upwards, within sectors.
•
Sectorally, there is a need to meet the needs of employers (2). This also
includes the health and social care sector. The population is ageing and
increasing. It has been challenging to attract sufficient numbers into the public
sector, including the health service during the period of growth.
Aberdeen City & Shire: Key Implications (3)
.
Recommended Areas of Focus
•
A need for progression routes and pathways. Demand for skills in the region is
strongest at the upper and lower skills levels – professional and elementary
occupations – and so progression to upper skills levels needs to be engendered
and facilitated. This is linked to employer investment in skills.
•
Repositioning the skills system to reflect a changing economic structure which
includes:
•
•
Recognising the region’s Universities and Colleges as major assets; and
•
Broadening and re-aligning the provision of work based learning and
apprenticeships.
A need to support re-skilling. There are many who were working in the oil and
gas sector who have out-dated, or the wrong skills for other sectors. Whilst many
skills will be transferable, others will need retrained and/or to develop new skills.
Aberdeen City & Shire: Key Implications (4)
.
Recommended Areas of Focus
•
A need for flexible provision. Non-permanent employment is increasingly a
feature of the Scotland economy and more of the future jobs are expected to be
part-time. Non traditional employment also means less conventional career paths,
and movement between sectors. Skills provision must be equally flexible, and
work-based learning is a feature of this.
•
A need to meet the region’s infrastructure needs. This will require adequate
construction, engineering and professional skills given anticipated levels of
Aberdeen City Region Deal and other investment. Tackling gender imbalances in
the sector can be part of meeting these needs.
•
Improving our understanding of the labour market. Transition will necessitate
the need for ongoing evidence on the skills needs of the regional economy.
•
De-cluttering the landscape is necessary as will be co-designing solutions and
joining up decision making, putting delivery and accountability in the right places.
Aberdeen City & Shire: Key Implications (5)
.
Recommended Areas of Focus
In addressing these recommended areas of focus partners, in developing and
implementing the Regional Skills Strategy, will prioritise around four key thematic
objectives:
•
Continuing to support the ongoing restructuring of the oil and gas sector and
ensuring that the appropriate number, level and type of skills are available to
support the industry in the future.
•
Providing resources to support the growth of the identified key economic growth
sectors in line with the identified economic priorities.
•
Providing ongoing support to volume employment markets including Health and
Social Care, Public Sector and Construction.
•
Delivering on the Governments inclusion and young people’s agenda.
Appendix: Explanation of Sector Trends and Specialism
diagram
The Sector Growth diagram allows three pieces of sector information to be displayed, providing a useful overview of
the local economy. The diagram includes:
Sector size (in terms of employment) – shown through the relative size of the dot representing the sector.
Sector concentration relative to the Scottish average – The level of concentration is illustrated on the vertical axis
through the Location Quotient. The Location Quotient is a measure of the concentration of industry in an area
compared to the national average. It produces an index whereby a score of 1 indicates the industry employment
concentration is the same both in the local area and nationally, more than 1 represents a higher concentration and less
than 1 a lower concentration.
Sector average annual growth rate – The horizontal axis shows the average annual employment growth rate of each
sector over the past five year period.
The diagram includes four quadrants:
Top right quadrant - sectors that have shown employment growth and are more highly concentrated in the local area
than the national average
Bottom right quadrant – sectors that have shown employment growth but are less highly concentrated in the local area
than the national average
Top left quadrant – sectors that sectors that have shown employment decline and are more highly concentrated in the
local area than the national average
Bottom left quadrant - sectors that sectors that have shown employment decline and are less highly concentrated in
the local area than the national average
Click here to go back to the main presentation:
Where are the Jobs (3) - Sector Specialisms