The latest Demos-PwC “Good Growth for Cities Index” revealed that Edinburgh and Glasgow have improved their performance in the rankings of UK cities against last year’s index.
Of the three Scottish cities included in the analysis, Edinburgh climbed six places to ninth overall while Glasgow moved up four places to 31st. The report also revealed Edinburgh as the fourth most improved city on the Index.
Aberdeen, meanwhile, slipped to 37th place from 31st place last year. However, the analysis predicted Aberdeen will experience the strongest economic growth of the Scottish cities in the Index in the coming years.
The Demos-PwC Good Growth for Cities Index was established in 2011 and is updated annually. The Index looks beyond GDP and covers broad economic measures.
These include jobs, health, income, safety and skills, as well as work-life balance, housing, travel-to-work times, income equality, high street shops, environment and business start-ups.
The Index ranks 51 of the UK’s largest cities — generally considered those with populations of at least 350,000 — plus the London boroughs.
The Index weights each variable based on the UK public’s opinion on the relative importance of the measure in question.
While all three Scottish cities performed above the UK average when it comes to the ratio of house-price-to-earnings and skills among 16-24 year olds and over-25s — with Edinburgh and Glasgow also tracking above the UK average for work-life balance — the report revealed that Scots place more value on other indicators measured by the Index.
The most important of the 12 indicators for Scots are income distribution, income, safety and work-life balance — indicating that those living north of the border are prioritising personal wealth, a fair economy and personal wellbeing.
In comparison, house-price-to-earnings ratios and skills indicators are weighted as less important for Scots than the UK average.
Jason Morris, Regional Market Leader at PwC Scotland, said: “The latest Good Growth for Cities Index demonstrates a tale of three cities in Scotland.
“While all three are united in their overarching strengths including skills and the ratio of house-prices-to-earnings, when we look at performance across the indicators in the context of what members of the public place the most value in, the picture looks slightly different.
“Strength in skills and the relative affordability of housing demonstrate that we have the foundations laid to enable Scotland to attract new talent and retain its existing strong skills base.
“However, there is a need to address the public priorities for Scots highlighted in the Index which underline some key disparities across our cities. Our polling showed that Scots place importance on income, equality of income distribution, safety and work-life balance.”
The report set out expected economic growth for Scotland in 2024 and 2025 — predicting it to have the fifth and sixth strongest economic growth of the UK’s 12 nations and regions, respectively.
The Index predicted positive economic growth for Scotland, at 1.1% in 2024 and 1.9% in 2025, which is broadly consistent with expected UK average growth of 1.0% and 1.7%, respectively.
Despite moving down the overall Index rankings, the analysis predicted Aberdeen will experience the strongest economic growth of the Scottish cities in the Index in the coming years – 1.2% in 2024 and 1.8% in 2025. This is mostly driven by projected growth in the “professional, scientific and technical” sector.
While Glasgow and Edinburgh are expected to perform similarly in terms of economic growth in the next two years, the Index notes that Edinburgh will have the lowest rate of all three Scottish cities in 2024, but a higher rate in 2025 — driven by a projected improvement in the outlook for the “finance and insurance” sector, which represents more than a quarter (25.8%) of economic activity in the capital.