Scottish cities to avoid worst of Covid-19 downturn

Topshop Topman store on Princes Street, Edinburgh - Credit: PA

Scotland’s cities fared better than others in the UK during the coronavirus pandemic, a new study suggests.

According to the Good Growth for Cities report, compiled by PwC and think tank Demos, the economic decline felt in the Scottish city worst-affected by Covid-19 would still not exceed the UK-wide average.

Following an analysis of gross value added (GVA) – a measure of local economies and different sectors – the report shows Glasgow’s economy contracted by 10.4% in 2020, compared to an average of 11% for cities across the UK.

The report assessed a number of “economic factors” in 42 of the biggest cities in the UK, including jobs, health, income and skills.

Edinburgh was also the least affected city in the UK, although its economy still reduced by 9.1% last year.

Stewart Wilson, the government and health industries leader for PwC Scotland, said the report highlighted the need to look beyond traditional measures of economic success such as GDP.

“The latest Good Growth for Cities report examines a country clearly facing an enormous challenge, which has impacted the health and the economies of our towns and cities like nothing else in recent memory”, he said.

“The pandemic has shone a spotlight on existing economic and social inequalities.

“This reinforces the view that when the post-pandemic recovery begins in earnest, we must look beyond GDP and focus our collective efforts on tackling issues that really matter to the public, and their local economies, such as skilling, sustainable income and health and wellbeing.

“We need an approach which takes into account the strengths and needs of individual towns and cities to build more resilience and drive a fair recovery across the UK.”

He added: “This year’s survey shows that Edinburgh – thanks in part to its broad spread of economic sectors – has been less impacted economically than other cities. However, in line with the rest of the UK where cities hardest-hit will be quickest to recover, it seems Glasgow will be quickest to emerge.”

The report also predicts that cities hit worst by the pandemic will see a quicker recovery, although they will still be worse off than pre-pandemic levels.

Glasgow’s economy will grow by 4.6% this year, according to a projection in the report, with Aberdeen rising by 4.1% and Edinburgh seeing 3.9% growth.