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Local Analysis: How Glasgow’s economy benefits from Scotland’s place in the UK

November 2018

Glasgow benefits greatly from Scotland’s place in the UK according to our latest analysis of official data

The analysis shows that 16% of Glasgow’s economic output is attributable to Scotland’s place in the UK.   The city remains a major beneficiary from Scotland’s place in the United Kingdom driven largely by growing and successful financial, IT, life science and engineering sectors. The report estimates that Scotland’s place in the UK boosts the Gross Value Added (GVA) of Glasgow by circa £3.3bn and supports more than 67,000 jobs.

The City is also benefitting from a £1.13bn city deal which is investing in infrastructure, life sciences and innovation over a twenty year period, designed to increase the gross value added of the area by 4% – a good example of devolved, local and national institutions working well together.  Glasgow’s key industries such as shipbuilding, advanced engineering and distilling also benefit from unrestricted access to UK markets.

Yet despite these positives, Glasgow’s economy differs significantly from other parts of Scotland which make its exposure to risk from Scotland’s departure from the United Kingdom all the greater.  These include:

  1. A higher proportion of Glasgow’s economy (25%) consists of public administration – including health and education – than the Scottish average (21%).  This means that Glasgow benefits disproportionately from the Union Dividend (higher public spending in Scotland) and other fiscal benefits that the UK brings. An independent Scotland would begin life with a large fiscal deficit, meaning that large cuts to public spending would be necessary.
  2. The city’s financial sector is 50% larger than the Scottish average and so the city benefits disproportionately from the UK’s regulatory framework. The sector is focussed on a UK client base and many Scots financial firms would need to move operations south of the border to remain within the UK financial framework. This would have a major impact on Glasgow. Of course, all Glaswegian businesses benefit from the lower interest rates and currency stability that Sterling brings.
  3. Overall, the Glasgow economy which consists largely of the financial sector, business services and manufacturing, is more export-oriented than Scotland as a whole.  Removing the benefits of unfettered access to the UK single market would have a profoundly negative impact on Glasgow and Scotland.
Local Analysis

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WIN WIN – The business case for Scotland’s place in the UK

September 2018

As part of the United Kingdom, Scotland has the potential to become one of the best places in the world to do business.

In this paper we demonstrate, using analysis based on official data provided by the Scottish Government, the Office of National Statistics (ONS) and the official EU data service (EuroStat) how Scotland and Scottish business benefit as full partners in the United Kingdom. This includes the Government Expenditure and Revenues Scotland (GERS) dataset, an annual assessment of tax and spend in Scotland compared to the United Kingdom as a whole, which is carried out by Scottish Government Statisticians.

Notwithstanding the ongoing dual constitutional debate about Scotland’s place in the United Kingdom and Brexit, Britain as a whole is a stable and benign business environment which is highly attractive to global investors. Scotland’s place in the United Kingdom allows business here to share in key United Kingdom advantages such as its large and integrated single market and sophisticated monetary regime.

Read ‘Win – Win’ from SBUK

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and/or download our research paper

Views from the board

  • Having heard investors that I know well, actively stepping back from investing in the Scottish economy, I fear for the future and am urging business leaders to share their support for Scotland to remain in the Union of the United Kingdom. It will only be by strength of voice and an evidenced based case that we will be able to defend the will of Scottish businesses of all sizes to remain in the Union.
    — Robert D. Kilgour
  • The voice of business sends a strong message back to the Government that a further independence referendum is not wanted among the business community. Business owners are no longer prepared to sit back and allow momentous decisions on the future of Scotland to be taken without full engagement with those who will be directly affected
    — Struan Stevenson
  • We must make the compelling case for the unique benefits of being within and trading as part of the Union. Scotland’s genuine majority voice must be heard and the majority do not want another referendum or to divide our Country at a time when we need to pull together!
    — Ivor Tiefenbrun MBE
  • Patriotism is a love for your country and as a proud Scot I have spent my career helping to build economic opportunities and in attracting investment. I am also proud to be British and passionately want the United Kingdom to endure.  To succeed in that aim, we must acknowledge that remaining part of the Union is a key lynchpin in growing Scotland’s wealth.
    — Jack Perry CBE
  • The break-up of the United Kingdom would be disastrous for Scottish business, not least because rUK represents two-thirds of our market. In what are already challenging economic times, it would be madness to introduce trade barriers between us and our principal market.
    — Dr Richard J Marsh

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