Employment Rate in Aberdeen and How it Affects The Economy

Aberdeen has always been famous for being the 3rd largest city in Scotland, its proximity to the sea, and its unique uniform granite architecture. However, in 2023, the area became even more famous for its relatively higher employment rate and improved work sector. In addition, Aberdeen is currently ranked as one of the best cities in the United Kingdom in terms of job opportunities. All data points to a thriving job market in this city, and we’ll be taking a detailed look at why this is so. We’ll explore how the city’s employment market positively influences its economy.

Employment Rate in Aberdeen

Until the 1970s, Aberdeen’s major industries were textiles, foundry work, shipbuilding, and paper-making. However, like any other location, the city has evolved, diversifying into many leading industries. The area’s new markets include high technology development, research in agriculture and fishing, and oil exploration. The oil and gas market is the city’s largest industry today. It is responsible for most of its employment opportunities. It’s safe to conclude that this is why Aberdeen is currently dubbed the oil capital of Europe.

In a recent report, the Office of National Statistics (ONS) in the UK revealed that the city’s employment rate went up in 2023, reaching 74.7% by December. Of people in the age bracket 16-64, 74.7% had access to job opportunities, which is slightly higher compared to the 74.4% of those who had access to jobs in 2022. Although this figure might seem minimal, it’s impressive considering today’s global economic recession. While many states and cities are recording job losses and dwindling employability, Aberdeen recorded an exceptional high and was the only Scottish city featured in the UK’s top 15 most employable cities.

Aberdeen also received some points for having one of the most impressive salary growths (9.3%). The city’s average salary was recorded at £35,153 annually, and business density also grew by 2.2%. This data was collated based on a recent report from Ciphr. The report listed 15 other cities in the UK with thriving economies and work cultures, with Aberdeen at the 9th position amongst all others.

Factors Influencing Aberdeen’s Employment Rate

Amongst the factors influencing Aberdeen’s employment rate are its economic diversification, impressive salary increases, and thriving business growth. For one, the city has a long list of thriving industries and job opportunities. The petroleum sector created an estimated half a million jobs. According to the Financial Times, in 2023, workers in the sector were, on average, paid £88,000, which is so much higher than the average £29,000 Scottish workers got. Also, considering that the business density in Aberdeen is 77.2, which has also increased by 2.2% in the last year, there are more roles opening up for job seekers in the location. These roles spread across sectors like agriculture, tech, and manufacturing.

Economic Influence on Aberdeen’s Employment Rate

The influence of employability on a city’s economy is broad and a two-way street. Traditionally, a lack of employability will instigate much lesser productivity in the labour force. The lack of employability will affect businesses and entrepreneurs, the standard of living and Gross Domestic Product (GDP), and its direct impact on economic progression. On the flip side, an increase in employability could improve labour force productivity, the standard of living, and the overall economy. Below are the direct ways Aberdeen’s employment is likely to boost its economic positioning.

Investments and Innovation

It is common knowledge that the investment market is mainly attracted to thriving cities and states. This attraction is why countries with the most robust economies have the highest number of investors in businesses, stocks, and forex trading. Higher employment can lead to increased investment in skills and innovation as companies seek to improve productivity and expand their operations.

Consumer Spending

Some of the data revealed in this article have established that this city has one of the most favourable salaries. With these advantages, it is expected that consumer spending will increase with time. Employed individuals have more income to spend on goods and services, which drives demand and supports businesses. At the same time, they can pay their taxes, which helps provide government revenues for infrastructure and public services.

Economic Growth

Higher employment rates contribute to greater overall economic activity and growth, as more people working means more production and consumption, increased purchasing power, and an influx of investors into the city. Healthier economic conditions typically snowball to create a heightened demand for the country’s currency as well as better appreciation. So when cities like Aberdeen and others across the United Kingdom perform better, it has a direct impact on GBP, increasing its value against other currencies in the global financial market.

Aberdeen’s Economic Future

The past year’s recession has been draining for many economies. However, the inflation rates have dwindled across the board. Several states and cities are still recovering from its effects on their economy. It is impressive to see Aberdeen’s performance despite these challenges. Also, it indicates how much this city has to offer to its workers and citizens. Aberdeen has many opportunities due to its diversification and extensive business network. It is more likely to perform even better in years to come. If you’re looking to build a career in any city in the UK, this could be an excellent location to add to your list.