East Region economic review

Scottish Enterprise (SE) commissioned a series of economic reviews focusing on the functional economic geographies of the regions that form SE’s operating area: Aberdeen City and Shire, Dundee City Region, East Region, West Region and South of Scotland. The objectives of the review were to: review economic trends and performance since 1999; assess the potential contribution of each region to the Government Economic Strategy’s (GES’s) targets; and to assess the likely impact of the recession on each region. This report is for the local authority areas of Borders, Clackmannanshire, East Lothian, Edinburgh City, Falkirk, Fife (excluding North East Fife), Midlothian, Stirling and West Lothian.

The GES’s seven purpose targets form the basis for assessing progress towards improving Scotland’s economic performance, and provide structure to the review. The review took the following approach: an examination of the global and national economic context; a review of recent economic trends and performance in the region; a comparison of performance with other regions; an assessment of the industrial structure of the region, including representation within key growth sectors; consideration of infrastructure and place issues; the performance of local authority areas within the region; and a final economic outlook for the region.

The review concludes that: in terms of economic growth the region outperformed both Scotland and the UK between 1999 and 2006, and is the only Scottish region to have achieved growth over the UK average in this period; economic contraction is likely to be less than in the UK as a whole; productivity levels were above the Scottish and UK averages in 2006; employment rates have been above the Scottish and UK averages since 1999; the region also performs well against other labour market indicators including unemployment, inactivity and benefit dependency; the region’s population grew by five per cent between 1999 and 2007, compared to one per cent in Scotland as a whole, and continued population growth is predicted for the decade ahead; median earnings of employees in the region are higher than in Scotland as a whole, but evidence of wide disparities exists; the employment rate in the region as a whole is slightly above the Scottish and GB averages, but one local authority area within the region had one of the three lowest employment rates in Scotland in 2007; the region accounts for one third of Scotland’s CO2 emissions, and emissions per head are higher than Scottish and UK averages; the impact of the recession on the region is likely to be in line with Scotland as a whole but less severe than the UK as a whole; and the region is expected to outperform Scotland during the recovery but GVA growth is expected to be lower than that of the UK as a whole during the period 2011-2018.

It was not within the remit of the review to make recommendations.