Regional Skills
Assessments
Aberdeen City and Shire
Region
December 2016
Introduction
•An Introduction to Regional Skills
Assessments (RSAs)
•Key Data for Aberdeen City & Shire
•Implications for Skills Investment
Planning
An Introduction to
RSAs
What are RSAs?
• A single, agreed evidence base on which to base future investment in
skills, built up from existing datasets
• Partnership between Skills Development Scotland (SDS), Highlands
and Islands Enterprise (HIE), Scottish Enterprise (SE), the Scottish
Funding Council (SFC) and the Scottish Local Authorities Economic
Development Group (SLAED).
• Purpose:
• 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
• Highlight gaps in national and regional skills evidence
Why are they important for skills
planning?
• They provide a high quality and consistent source of evidence about
economic and skills performance delivery at various spatial levels.
• They can be used to identify regional strengths and any issues or
mismatches arising, and so inform thinking about future planning and
investment at a regional level.
• They are accessible online to support all partners in their planning.
• They provide a core evidence base to support the Scottish Skills
Planning Model.
Scottish Skills Planning Model
What do RSAs cover?
• Economic Performance, Profile of the Workforce, People and Skills,
Education and Training (MAs and Schools), Other Economic
Activity, Skills Mismatches and Forecasting
• Underpinned by the 2016 data matrix of seven workbooks,
containing data on over 100 social and economic indicators
• With data at various spatial levels: Regions; City Region Deal; Local
Authority
• The matrix only draws upon official datasets (including APS, BRES,
UKCES, UK Business Counts, Census, Scot Gov datasets) and
partner data (SFC, SDS, SE, HIE).
• The data matrix is found here:
https://www.skillsdevelopmentscotland.co.uk/what-wedo/partnerships/regional-skills-assessments/
• This slide pack provides a summary of the data for this area
Aberdeen City & Shire Overview
• An area of historically high wage
levels and strong employment
opportunities but facing the
challenges of oil and gas downturn
• Relatively distant from the central belt
but with well developed air services
for business travel
• Contrast of a city with a specialism in
oil and gas and Aberdeenshire where
primary industries are important to
many areas
Business Trends
Growth in business numbers in
2015 was below the national
level for the first time since 2010
(4.9% v. 7.3%)
More than half (58%) Aberdeen City and
Shire businesses are in Growth Sectors
(47% nationally), the highest number
(13,560) and percentage of all 13 regions
(2015)
25,000
25,000
23,000
20,000
21,000
15,000
19,000
17,000
10,000
15,000
2010
2011
2012
2013
2014
2015
5,000
58%
Aberdeen and Aberdeenshire



+1,090 to 23,320 businesses in 2015
Largest increases in Professional Scientific &
Technical (+ 360) and Business
administration & support services (+ 250)
98% of businesses are small or micro (<50
employees) as per Scotland, but lower in
Aberdeen City (96%); 100 businesses employ
250+
474 businesses per 10,000 population,
compared to 313 in Scotland
Self-employment slightly below Scottish
average (9.1% v. 10.8%)
58%
Aberdeen and
Aberdeen City
Aberdeenshire
Growth sector
Other
Scotland index


58%



Aberdeenshire
Aberdeen City and Shire has a greater
proportion of Growth Sector businesses in
Financial and Business Services than
nationally (43% v. 35%), and fewer in Tourism
(8% v. 18%)
37% of employment, the highest in Scotland,
is in Growth Sectors (28% nationally)
BERD is £411 per head, compared to £169
nationally and £309 UK wide (2014)
Sector Trends and Specialisms
 Exceptional employment
growth in two large, highly
specialised sectors –
production and
professional, scientific and
technical, although recent
downturn in oil and gas may
reverse this trend
 Good growth in visitor
economy, although again oil
and gas difficulties may
impact on future growth
 Significant job losses in two
national Growth Sectors –
finance and insurance and
information and
Note: SIC Section A: Agriculture, Forestry and Fishing omitted as data for farm
communications
agriculture (SIC subclass 01000) is not available sub-nationally
Click here for explanation: Explanation of
Sector Trends and Specialism diagram
Population and Projections
Population of 492,000


9.2% of Scotland total
Growth similar to national trend 2014-2015
(0.6% v. 0.5%) but much higher between 2005
and 2015 (10% v. 5%)
Forecast Population Growth,
2014-2037:
Aberdeen City & Shire
Scotland
21%
Population change 2005-2015:
Aberdeen City & Shire
11%
Scotland
19%
8%
18%
10%
Total
-4%
4%
4%

-2%
0-15

Working Age
16-64
65+
Total Increase of 46,000 people between 2005
and 2015, including growth in all three age
groups

Population forecast to increase by 21%
(101,000 people) compared to 8% growth in
Scotland
Aberdeen City and Shire working age
population forecast to increase by 11%
(36,500 people) compared to a fall of 4%
nationally – only Edinburgh is forecast to see
faster growth
Employment and Travel to Work
79% of working age residents
are in employment, higher than
the Scotland rate of 73%
90%
Aberdeenshire
9% 1%
57%
Aberdeen City & Shire
40%
73%
0%
20%
Home LA
40%
Rest of RSA
 The majority of Aberdeen City
residents work in that area
 A large proportion (40%) of
Aberdeenshire residents work in
Aberdeen City
Place of Work of Residents, by
Local Authority:
Aberdeen City
 Almost three quarters of residents in
the Aberdeen City and Aberdeenshire
region work within the area
3%
25%
60%
80%
Outside RSA
2%
100%
Please note, location of employment figures exclude those
working outside the UK, on offshore installations or
with no fixed place of work
Workforce Trends
Total employment in Aberdeen
City and Shire = 297,600
44% work in higher level
occupations (2015)
 Above Scotland average (42%) with a
slight fall (<1%) from 2014
 84% work in private sector, well above
the Scottish rate of 77%
 Aberdeenshire has the highest rate of
private sector employment (84%),
Aberdeen City second highest (83%)
320,000
300,000
280,000
260,000
240,000
220,000
200,000
2009
2010
2011
2012
Aberdeen and Aberdeenshire
2013
2014
Scotland index
 5.2% increase 2013-2014, compared to
3.2% nationally and 2.7% across GB,
the second highest rate of employment
growth in Scotland
 Higher growth rate than Scotland since
2010
26% of those in employment work
part-time, same as for Scotland
 3.9% are in non-permanent
employment, well below the rate for
Scotland (5.4%)
Note: Data on total employment relates to 2014, having been prepared in
advance of 2015 BRES release.
Unemployment and Participation
Unemployment has fallen each year since 2012,
in line with national trends.
10%
8%
6%
Participation rates amongst
young people above the Scottish
average, with only 3% not
participating
92% 90%
4%
2%
0%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Aberdeen and Aberdeenshire
Scotland
Unemployment currently stands at 3.2%, notably
lower than the national (5.9%) and UK averages
(5.4%) The region has had a greater percentage
point fall than Scotland over the 2014-15 period (1.1ppt v. 0.4ppt)
The unemployment rate in the region was below
the national average (3% v. 6%), unemployment
fell by -1.1ppts which was greater than the
national decline (-0.4ppts) from 2014 to 2015
Within the region the unemployment rate was
highest in Aberdeen City (4%) and lowest in
Aberdeenshire (2%)
3%
% Participation
4%
5%
6%
% Non Participation % Unconfirmed Status
Aberdeen City & Shire
Scotland
Qualifications and Skills
An increasingly highly-skilled
workforce, with a growing
proportion holding higher level
qualifications:
% point change 2005-15
12.9
10.2
9.1
More Aberdeen City and Shire
working age adults hold SCQF
qualifications at levels 7-12 than is
the case nationally and UK wide
(37%):
11.8
6.7
0.7
-0.6
-0.9
47%
-1.5
-6.0 -5.8
43%
Scotland
Aberdeen and
Aberdeenshire

45%
-4.3
Aberdeen City & Shire

48%
Increase of 13 percentage points in the
proportion holding levels 7-12 since 2005
The proportion with no qualifications has
fallen faster than the national average, with
a 6.0% decline
Aberdeen City
Aberdeenshire
Scotland
Skills Mismatches
Aberdeen City and Shire
employers are slightly more
likely to report skills gaps but
less likely to state underutilisation of skills
More than half (52%) of
Aberdeen City and Shire
businesses have recruited staff
over the past year (2015),
slightly below the national
average (53%)
Skills shortages are as prevalent
as they are nationally
 0.8% of employers report vacancies
that are hard-to-fill due to skills
shortages (down 1ppt from the 2013
Employer Skills Survey), the same rate
as Scotland
 7% of the workforce have a skills gap,
compared to 5% in Scotland
 Skills gaps particularly prevalent in
Sales & Customer Services and Skilled
Trades occupations
 65% of employers with a skills gaps
say there is an impact on the business
(70% nationally) with 48% of all
employers saying the impact is major
(Scotland 52%)
Education and Training
Schools
Modern Apprenticeships
Apprenticeship
The secondary school roll in 2015 Modern
was 23,026, 8.2% of Scotland total uptake fell
(MA)
From 9% of national total in 2014/15
to 8% in 2015/16
94% of school leavers enter a
positive destination, compared to
Construction most popular MA
92% across Scotland
framework group
16% of uptake
Heavily gender segregated - 98%
male
75% MA achievement rate in
2015/16
Further and Higher Education
In 2015/16, at North East Scotland There were over 30,000 students at the
College there were 21,475 enrolments three HEIs in the region in 2014/15
 8% of Scotland’s total
 79% FE and 21% HE
2014/15 students at HEIs in Aberdeen and Aberdeenshire
Total university students
Top three subjects:
 Full-time: Engineering, Business Admin,
Computing & ICT
 Part-time: Care, Engineering, Languages
& ESOL
University of Aberdeen
16,250
Robert Gordon University
14,170
SRUC Aberdeen
240
Total
30,665
Top three subjects:
67% successful completion of FE  Business & Admin, Subjects Allied to
Medicine and Engineering
courses
University Graduates by Employment Status
2014/15
College Leaver Destinations 2014/15
1%
Scotland
Aberdeen and
Aberdeenshire
79%
16%
72%
Further Study
16%
Work
Other
4%
12%
Scotland
Aberdeen &
Aberdeens…
Full-time work
Work and further study
61%
11%
16%
6%
63%
10%
15%
8%
5%
1%
Part-time work
Due to start work
Further study only
Unemployed
HE/FE data is available at regional level only. Data relates to enrolments at FE and HE Institutions in the region, not residents unless otherwise stated.
Data provided by SFC and HESA
3%
Workforce Growth
The size of the working age
population is expected to rise by
11% in Aberdeen City and Shire over
the next 20 years, compared to a 4%
fall nationally
 36,500 more people of working age,
which presents an opportunity to
boost GVA if there are sufficient
additional job openings
 There is a risk that the forecast growth
in working age population does not
fully reflect the potential longer term
impact of the oil and gas downturn i.e. there may be less potential than
previously to increase the size of the
economy through population growth
Despite the forecast population
growth, Aberdeen City and Shire is
expected to have very limited
employment growth over the 20162024 period (0.4% v. 1.0% nationally).
This will equate to an additional
1,100 people in employment
 In comparison, over the 2006-16
period, the number of people in
employment rose by 13.4%
Improving productivity will become the key determining factor in
increasing economic prosperity, and there is a need to provide high
quality job opportunities for the growing working age population
Jobs and Skills Changes (1)
Total employment (jobs) is forecast to remain relatively flat over 2016-2024, average annual growth of 0.2% is
expected for Scotland as a whole. Accommodation and food services and transportation and storage are
expected to have growth of 4,400 jobs and 2,900 jobs respectively over the period 2016-24. The financial and
construction sectors are also expected to grow, 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%
Source: ONS / Oxford Economics
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 and
Aberdeenshire 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
Source: Oxford Economics
-1
0
‘000s
1
2
Jobs and Skills Changes (3)
The majority of openings in Aberdeen and Aberdeenshire from 2016 to 2024 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
Source: Oxford Economics
Expansion demand
2,100
4,300
-3,000
-700
-2,400
-600
-300
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 from 2016 to
2024. 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
Source: Oxford Economics
Note: totals may vary from previous slide due to rounding within the body of the table
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
Implications for Skills
Investment Planning
Aberdeen City & Shire: Key Implications (1)
.
Recommended
Areas of Focus
•
Diversifying the employment base. Job losses in the oil and gas sector have
been swift and significant following the 2015 fall in global oil prices. Approximately
10,000 more jobs are forecast to go and the region will need to compensate for
these lost jobs.
•
Creating high quality 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.
•
Maintain and develop the culture of employer investment. Employers will need
to continue 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 under-investment in the workforce in recent years. The supply of
skills must also be available to satisfy increased and stimulated demand.
•
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.
Aberdeen City & Shire: Key Implications (2)
.
Recommended Areas of Focus
•
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.
•
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.
Aberdeen City & Shire: Key Implications (3)
.
Recommended Areas of Focus
•
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.
•
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.
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: Sector Trends and
Specialisms