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ANGUS ECONOMIC DIGEST - 2010

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					    ANGUS
ECONOMIC DIGEST
     - 2010
                                               Contents
                                                                                     Page
Foreword                                                                               i
Chapter One                The Place                                                   1
Chapter Two                The People                                                 22
Chapter Three              The Economy                                                47
Chapter Four               Employment                                                 97
Chapter Five               Employability                                             112

                                                Maps

                                                                                     Page
Map   1.     Annual and Quarterly GDP rates in the Eurozone                            ii
Map   2.     Angus                                                                     1
Map   3.     Principal Transport Network in Angus                                      4
Map   4.     Areas of Angus without Broadband in 2008 (by Postcode)                    7
Map   5.     HMAs in Angus                                                            10

                                               Tables

                                                                                     Page
Table 1.    Key indicators for the Euro Area                                          i
Table 2.    Scottish and UK Growth Forecasts                                          iii
Table 3.    Scottish Executive Six-Fold Urban Rural Classification                    2
Table 4.    Scottish Government Six-Fold Urban Rural Classification by LA, 2007-08    2
Table 5.    Mid-2008 Population Estimates for Localities                              3
Table 6.    Total Population, by Multi Member Wards (2008)                            3
Table 7.    Distances and Travel Duration from Arbroath                               4
Table 8.    Households with Internet access by country, 2006 - 2009                   8
Table 9.    Scottish Companies and E-Business Survey, 2001 - 2007                     9
Table 10.   Housing Stock and Council Rent Levels                                     12
Table 11.   Characteristics of Dwellings by LA, 2008                                  12
Table 12.   Household estimates for Scotland by LA, 1991/2008                         13
Table 13.   Occupied and Vacant Dwellings, 2008                                       13
Table 14.   Scottish LAs with Vacant Dwelling Stock (2001)                            14
Table 15.   Scottish LAs with Vacant Dwelling Stock (2008)                            14
Table 16.   LA Rankings – House Prices Scotland (April – June 2006)                   16
Table 17.   LA Rankings – House Prices Scotland (October – December 2008)             16
Table 18.   LA Rankings – House Prices Scotland (January – March 2010)                17
Table 19.   CT Banding Levels 2005/06 (£)                                             17
Table 20.   CT Banding Levels 2009/10 (£)                                             17
Table 21.   CT Breakdown of Properties in Angus                                       18
            Number Of Crimes Recorded by the Police and % Cleared up,
Table 22.                                                                             20
            2005/06 - 2008/09
                                                                                         Page
            Number of Crimes Recorded by the Police per 10,000 Population and Crime
Table 23.                                                                                 20
            Index, 2005/06 - 2008/09
            Number and Rate per 100,000 Population of Drug-Related Offences
Table 24.                                                                                 21
            Recorded by Scottish Police Forces: 2003/04 - 2007/08
Table 25.   Population by Age, 2009                                                       22
Table 26.   Projected Population Changes (2006 based projections)                         22
Table 27.   Projected Population Changes (2008 based projections)                         22
Table 28.   Projected Population Increases in Angus and Scotland                          23
Table 29.   Projected Percentage Change in Population, 2008 - 2033                        23
Table 30.   Working Age Population in Angus (2008)                                        24
Table 31.   Life Expectancy at Birth 2006/08, with comparisons to 1996/98 (Persons)       28
Table 32.   Life Expectancy (with rank) at age 65 in Scotland, 2006/08                    28
Table 33.   Life expectancy at birth in Scotland 2006/2008, (Persons, Males & Females)    28
Table 34.   Components of Population Change, 1999/2009                                    29
            Long-term Annual Net Migration Assumptions in Scotland 2014 -15
Table 35.                                                                                 30
            Onwards
Table 36.   Tayside Recent Migration Summary, Mid 2006 – Mid 2007                         31
            The Composition of Overseas Nationals entering Angus and allocated a
Table 37.                                                                                 32
            NINo in 2007/8
Table 38.   Births, by Country of Mother’s Birth, Scotland                                35
Table 39.   Country of Birth, Angus and Scotland, 2001                                    36
Table 40.   Claimants of out of work benefits by LA, 2007/2009                            37
Table 41.   Working age benefits                                                          37
Table 42.   Working Age Claimants of Key Benefits, November 2009                          38
Table 43.   Benefit Claimants (Working Age)                                               38
Table 44.   Total JSA claimants (June 2010)                                               39
Table 45.   Number and Proportion of JSA claimants from April 2006 – April 2010           40
Table 46.   JSA Claimants by Age and Duration (June 2006 and 2010)                        40
            Number and Proportion of Children Living in Households that are
Table 47.                                                                                 41
            Dependent on Out Of Work Benefits or Child Tax Credit
Table 48.   Population over State Pension Age Claiming Key Benefits, May 2004             42
Table 49.   National Share of Deprived Datazones by LA                                    45
Table 50.   Local Share of Deprived Datazones by LA                                       45
            Levels of Income and Employment Deprivation in the 15% Most Deprived
Table 51.                                                                                 45
            Datazones by LA
            Percentage of the Population Living in the Most Deprived Datazones who
Table 52.                                                                                 46
            are Income and Employment Deprived
Table 53.   Datazones in the 15% Most Deprived by Urban Rural Classification              46
Table 54.   GVA and GVA per head for Scotland and the UK, 2000 & 2007                     50
            GVA at basic prices per employee (£) by Industry in 1999, 2002, 2005 –
Table 55.                                                                                 51
            2007
Table 56.   Headline GVA at current basic prices, by NUTS 3 regions, 1995 and 2006        51
Table 57.   Headline GDHI per Head Indices at Current Basic Prices                        51
                                                                                       Page
            Stock of VAT registered enterprises and VAT registrations & de-
Table 58.                                                                               52
            registrations, 2006
Table 59.   Number of new businesses in Scottish Banks                                  53
Table 60.   Employment by Size of Enterprise, March 2006 & 2008                         54
            Number & Proportion of Enterprises, by Size of Enterprise, March 2006 &
Table 61.                                                                               54
            2008
            Number of Registered Enterprises in Scotland and their Total Scottish
Table 62.                                                                               54
            Employment and Turnover, March 2008
            Number of Business Sites of Registered Enterprises, Sector and Employee
Table 63.                                                                               55
            Size Band of Site, March 2009 - Angus
Table 64.   Number of registered enterprises in Angus by sector March 2009              56
Table 65.   Number and proportion of Employee jobs by industry, 2008                    56
Table 66.   Total Employment by Sector                                                  57
Table 67.   % Change in Employee Jobs                                                   58
Table 68.   Numbers of Staff Employed in the E & LB Sector, by Size Band                61
Table 69.   Modulation Rates                                                            62
Table 70.   Scottish Agricultural Output, Input and Income, 2001-2007                   64
Table 71.   Key Scottish Economic Indicators for Forest Industries                      65
            Value of sea fish landings into Scotland by Scottish based vessels;
Table 72.                                                                               67
            fishermen employed, by region 2008
Table 73.   Manufacturing Employment Change in Scotland, 1998 - 2007                    70
Table 74.   Change in the Manufacturing Sector in Angus and Scotland, 2006 – 2007       71
Table 75.   Manufacturing Sector - Key Indicators by LA, 2006                           71
Table 76.   Manufacturing Sector - Key Indicators by LA, 2007                           71
Table 77.   Manufacturing Sector in Angus - Key Indicators from 1998 – 2007             72
Table 78.   Total exports by industry (£million), 2004 – 2008                           72
Table 79.   Quarterly Index of Scottish Manufactured Exports, in Constant prices        73
Table 80.   Trends in Food and Drink Manufacturing, 2002 – 2007                         76
Table 81.   Key Statistics by Different Definitions of Food and Drink                   77
            Angus Awards from the Food Processing Marketing & Co-operation Grant
Table 82.                                                                               79
            Scheme
Table 83.   Summary of the Construction Sector, 2007                                    81
Table 84.   Service Sector - Key Indicators by LA, 2007                                 84
Table 85.   Service Sector - Angus and Scotland                                         84
Table 86.   Tourism Related Sector - Key Indicators by LA, 2006                         85
Table 87.   Tourism Related Sector - Key Indicators, 2000 – 2007                        86
Table 88.   Tourism Related Employment, 2003 - 2006                                     87
            Volume and Value of Tourism and Average Length of Stay and Spend in
Table 89.                                                                               88
            Scotland, by Origin, 2007
Table 90.   Visitor Numbers at Top Angus Attractions, 2007 & 2008                       88
Table 91.   Number and % share of total - Hotels and restaurants in Angus & Scotland    89
                                                                                         Page
Table 92.   Performance of Key Sectors in the DCR                                         90
Table 93.   Tourism Expenditure (£m), 2003 - 2007                                         91
Table 94.   Retail establishments in Scotland – June 2008                                 93
Table 95.   Number of TTWAs in the UK                                                     97
Table 96.   TTWAs: Key Statistical Characteristics                                        97
Table 97.   Commuting patterns by LA, 2008 (residence based)                              98
Table 98.   Factors in Labour Demand and Supply                                           99
Table 99.   Economic Activity Level by Gender in Angus (%)                               103
Table 100. Job Vacancies – October 2009 & April 2010                                     104
Table 101. Notified Vacancies by Industry, Scotland, 2003-2008                           105
Table 102. Vacancies in Angus and Scotland – September 2009                              105
Table 103. Vacancies in Angus and Scotland – April 2010                                  106
Table 104. Median Full Time Annual Gross Pay in Scotland, 2007-2008                      106
Table 105. Average Gross Weekly Pay by Workplace and Residence, 2008                     107
Table 106. Average Gross Weekly Pay by Workplace and Residence, 2008                     107
Table 107. Employment by occupation in Angus (April 2008 - March 2009)                   109
           Hard-to-fill and Skill Shortage Vacancies as a Proportion of Employees by
Table 108.                                                                               110
           Industry
           Hard-to-fill and Skill Shortage Vacancies as a Proportion of Vacancies by
Table 109.                                                                               111
           Occupation
Table 110. Projections of Employment by Highest Qualification, 2007 - 2017               114
           Proportion of working age adults with SCQF Level 4 qualifications or below,
Table 111.                                                                               114
           2004 - 2008
Table 112. Qualifications - 2005 & 2008                                                  115
           Percentage of School Leavers from Publicly Funded Secondary Schools in
Table 113.                                                                               116
           Scottish Education Authorities by Destination, 2008 - 2009
Table 114. S6 Attainment in 2008                                                         117
Table 115. Students in Colleges in Scotland, 1999-00, 2005-06 & 2007-08                  118
           Proportion of those aged 25-59/64 in Employment who are Graduates by
Table 116.                                                                               118
           LA, 2004 - 2008, (residence based)
                                           Figures

                                                                                         Page
Figure 1.    Angus House Prices                                                           15
Figure 2.    Levels of Housing Turnover in Angus                                          16
             Rate per 100,000 Population of Drug-Related Offences Recorded by
Figure 3.                                                                                 21
             Scottish Police Forces: 2003/04 - 2008/09
Figure 4.    Percentage Change in Population (2008 based) by Council area to 2033         24
Figure 5.    Age Structure of the Population                                              25
Figure 6.    Comparison of Population change for UK countries, 2006 - 2031                25
Figure 7.    Comparison of Population change for UK countries, 2008 - 2033                26
Figure 8.    Projected Population in Angus, by Age Group, 2008 Based Projections          27
Figure 9.    Net Migration to/from Scottish Council Areas, 1981/82 to Most Recent         30
             NINo Registrations to Adult Overseas Nationals entering the UK by World
Figure 10.                                                                                32
             Area of Origin as a percentage of the total (December 2008)
Figure 11.   Migrant Registrations - % Increase since 2002/3                              33
             Top 5 sectors - Geographical Distribution of employers of registered
Figure 12.                                                                                34
             workers by Sectors, May 2004 – March 2009
Figure 13.   Claimant Count and ILO Unemployment – Angus & Scotland                       39
             Proportion of Children Living in Households that are Dependent on Out Of
Figure 14.                                                                                41
             Work Benefits or Child Tax Credit (more than the family element)
Figure 15.   Scotland and UK Annual GDP Growth Rates, 2000 Q3 to 2009 Q1                  47
Figure 16.   GDP Rates for Scotland, 2004 – 2010                                          48
Figure 17.   Historic changes to Scottish GVA, by Sector, 2004 - 2009                     50
Figure 18.   VAT Registrations and De-registrations in Angus, 1994 – 2007                 52
             Historical and Projected Employment by Industry in Scotland, 1987 –
Figure 19.                                                                                59
             2012
             Significance of Primary, Secondary and Tertiary Industries and the Public
Figure 20.                                                                                60
             Sector by Geographic Area, 2007 (%)
Figure 21.   Employment in the Food and Drink Industry in Scotland, 1998-2007             77
Figure 22.   Number of Employees in the Construction Industry in Angus, 1995-2008         80
             Percentage of Hotels and Restaurants Registered Enterprises,
Figure 23.                                                                                89
             Angus and Scotland, 2001 – 2008
Figure 24.   Employment Rates in Angus and Scotland, 2008/9                              100
Figure 25.   Employment rates by LA, 2004/2008, by residence                             101
Figure 26.   Economic Activity by Geographic Area, 2008                                  102
Figure 27.   Rates of Economic Activity                                                  102
Figure 28.   Economically Inactive – Angus & Scotland (Oct 2008-Sep 2009)                103
             JSA claimants per unfilled JobCentre vacancy, January 2006 - October
Figure 29.                                                                               104
             2009
Figure 30.   Angus Residents by Occupation and Place of Employment, 2001                 108
             Projections of Qualifications Shares in the Working Age Population, 2007
Figure 31.                                                                               115
             and 2012
Figure 32.   Qualification levels in Angus, 1999 – 2008                                  116
Figure 33.   Percentage of Employees with Degree (June 2008 – June 2009)                 118
                    List of Abbreviations

AA      Attendance Allowance
ASDL    Asymmetric Digital Subscriber Line
BERA    Business Establishment Records Angus
BME     Black and Minority Ethnic
BT      British Telecom
CAP     Common Agricultural Policy
CHP     Community Health Partnership
CT      Council Tax
DCR     Dundee City Region
DEFRA   Department for Environment, Food and Rural Affairs
DLA     Disability Living Allowance
DWP     Department for Work and Pensions
ESA     Employment And Support Allowance
EU      European Union
FE      Further Education
FTE     Full Time Equivalent
GB      Great Britain
GDHI    Gross Disposable Household Income
GDP     Gross Domestic Product
GROS    General Register Office for Scotland
GSK     GlaxoSmithKline
GVA     Gross Value Added
GW      Gigawatts
HE      Higher Education
HEIs    Higher Education Institutions
HMA     Housing Market Areas
HNC     Higher National Certificate
HND     Higher National Diploma
IB      Incapacity Benefit
ICT     Information and Communications Technology
ILO     International Labour Organisation
IMF     International Monetary Fund
IS      Income Support
JSA     Jobseeker's Allowance
Kbps    Kilobytes Per Second
LA      Local Authority
NHS     National Health Service
NI      National Insurance
NINo    National Insurance Number
NMW     National Minimum Wage
NVQ     National Vocational Qualification
ONS     Office For National Statistics
RERAD   Rural and Environment Research and Analysis Directorate
SAC     Scottish Agricultural College
SAWB    Scottish Agricultural Wages Board
SCQF    Scottish and Credit Qualifications Framework
SDA     Severe Disablement Allowance
SDI     Scottish Development International
SDPA    Strategic Development Planning Authority
SFP     Single Farm Payment
SIMD    Scottish Index of Multiple Deprivation
SMEs    Small and Medium Sized Enterprises
SQA     Scottish Qualification Authority
SRDP    Scottish Rural Development Programme
SRTC    Scottish Regional Treatment Centre
SVQ     Scottish Vocational Qualification
TERU    Training and Employment Research Unit
TIFF    Total Income from Farming
TTWA    Travel to Work Area
VAT     Value Added Tax
WTO     World Tourism Organisation
     Foreword
This Digest is written to give an overview of the economy of Angus. It is split into 5 main
sections, covering;

                   The Place;                                          The People;
                   The Economy;                                        Employment; and
                   Employability.

An economy does not stand still, but is in a continual state of change. Its progress is tracked
using statistical information that allows the estimation of our current economic performance.
These estimates are subject to a host of factors, direct and indirect, that have to be taken
into account and placed in the context of Scotland, the UK and wider world before an
accurate picture can emerge.

The use of existing reporting mechanisms to try to show an overall picture has limitations,
which are fully acknowledged in this document. The main issue is the time lag between the
situation ‘on the ground’ and the production of statistics. This particularly becomes an issue
when an economy goes through a drastic change, as has happened globally recently.

The Credit Crunch, sub prime, banking crisis, economic downturn and recession, are all
phrases that appear daily in the media, due to the current situation.

There is no official definition of recession, but there is general recognition that the term
refers to a period of decline in economic activity. Most analysts use, as a practical definition,
two consecutive quarters of decline in a country's Gross Domestic Product (GDP). Although
this definition is a useful rule of thumb, it has drawbacks. A focus on GDP alone is narrow,
and it is often better to consider a wider set of measures of economic activity to determine
whether a country is indeed suffering a recession.1 One of the problems about officially
declaring a recession is that it can only be confirmed after it has happened.

The origins of global recession are in the financial sector, it has generally been attributed to
reduced liquidity, sector price inflation in food and energy, and the slow down in the United
States of America (USA). However, the impact has been felt most severely in the industrial
sector. The collapse in global demand has led to a sharp drop in industrial production. There
is now some evidence that this impact bottomed out in the first quarter of 2009. The latest
data illustrates that industrial production has stabilised and begun to show tentative signs of
recovery in some advanced economies.

The Euro Zone officially fell into recession in Q3 2008, with official data showing the 16-
nation euro zone economy had shrunk by 0.3% for the second quarter in a row - two
consecutive quarters of negative economic growth - meaning it was in recession.2

                                  Table 1: Key indicators for the Euro Area3

                                     Q2          Q3         Q4          Q1         Q2          Q3         Q4          Q1
              2008       2009
                                    2008        2008       2008        2009       2009        2009       2009        2010
  GDP         0.6        -4.1       -0.3        -0.3       -1.8        -2.5       -4.9        -4.1       -2.2         0.5
Source: European Commission (2010), Economic and Financial Affairs, Key indicators for the Euro Area


1 International Monetary Fund (2009), ‘What is a Recession?’, Finance and Development Magazine
2 Reuters (2008), ‘Europe in recession, U.S. in pain as world leaders meet’, 15.11.08
3 The euro zone is an economic and monetary union of 16 Member States of the European Union which have adopted the
Euro currency as their sole legal tender. It currently consists of Austria, Belgium, Cyprus, Finland, France, Germany, Greece,
the Republic of Ireland, Italy, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia, and Spain.



                                                                                                                             i
The UK officially entered a state of recession in January 2009, the first time since 1991.
GDP fell by 1.5% in Q4 2008 after a 0.6% drop in the previous quarter. It represented the
biggest quarter on quarter decline since 1980, and a 1.8% fall on the same quarter the
previous year.

Scotland officially entered a state of recession a quarter later than the UK. Scotland's GDP
fell by 2.5% in Q1 2009, following a 1.8% Q4 2008.4 In Scotland, GDP grew by 0.2% in Q4
2009, and remained the same for Q1 2010. The UK figures show that GDP on a comparable
basis fell by 3.3% in the year to end-March 2010 and grew by 0.3% in Q1 2010.

Although the UK entered recession a quarter earlier, the overall decline in output in Scotland
has been broadly in line with the UK. GDP in Scotland fell by 3.5% in the year to the end of
Q1 2010, compared to a decline in the UK of 3.3% for the UK as a whole.5

The Eurozone as a whole has emerged from the global recession, but recovery remains
patchy and fragile, with some countries still yet to register renewed growth. Across the 16
nations that have adopted the Euro, overall growth for Q1 2010 was 0.2% compared with Q4
2009. However, the picture is still gloomy in the Irish Republic, Greece, Cyprus and
Luxembourg, while fears of a ‘double-dip’ recession cannot be discounted.6 Quarterly and
annual GDP growth rates across the Eurozone can be seen in the map below. The UK,
which is not in the Eurozone, is shown in grey on the map for purposes of comparison.7

                         Map 1: Annual and Quarterly GDP rates in the Eurozone




Source: BBC (2010)




4 The Scotsman (2009), ‘Jobless total hits 12-year high – as Scotland enters recession’, 23.04.09
5 Scottish Government (2010), Gross Domestic Product for Scotland 2010 Quarter 1
6 A ‘double-dip’ recession refers to when GDP growth slides back to negative after a quarter or two of positive growth. A
double-dip recession refers to a recession followed by a short-lived recovery, followed by another recession.
7 BBC (24 May 2010), ‘In graphics: Eurozone in crisis’




                                                                                                                            ii
There is no exact science which can predict how long a recession will last, or how long the
recovery will take. The table below shows four different predictions of what might happen.

                                 Table 2: Scottish and UK Growth Forecasts

                                                   2010                        2011                    2012
                                             Scotland   UK               Scotland   UK           Scotland   UK
 Experian (Nov 2009)                           0.6      1.2                1.6      2.2            1.6      1.9
 Fraser of Allander Institute
                                                 0.6            -            1.6            -      2.2       -
 (February 2010)
 ITEM Club (Nov 2009)                            0.7           1.0           2.1          2.0      1.7      2.5
 Cambridge Econometrics
                                                 1.4           1.3           1.3          1.8      1.5      2.0
 (March 2010)
 Average                                         0.8           1.3           1.7          2.0      1.8       -
Source: Scottish Parliament (April 2010), SPICE Briefing – Economic Indicators, p.2

The average of the forecasts suggests that, while the recession in Scotland may not be as
deep as for the UK, it may last longer. With growth remaining below the long term trend until
at least 2011, unemployment is likely to keep on rising until at least that date.8

Emerging evidence suggests that many economies returned to growth in the second half of
2009, as conditions in the global economy continued to improve. However growth is
forecast to remain weak for advanced economies into 2010, as the process of adjustment
continues The UK economy is expected to follow a broadly similar pattern, contracting by
around 4% in 2009, and growing very modestly in 2010 by less than 1%.9

The commentary provided within this digest acknowledges the rapid changes that have
happened in the global, national and local economy since mid 2007. However, due to the
time lag in figures being released, the information may not always be up to date enough to
accurately reflect the current situation.




8 Scottish Parliament (2009), SPICE Briefing – The Financial Services Sector in Scotland, p.16
9 Scottish Government (2009), State of the Economy: August 2009



                                                                                                                  iii
  Chapter One The Place
Angus is a local authority (LA) in Scotland, covering an area of 218,148 hectares
(approximately 842 square miles), which equates to 2.8% of the land area of Scotland.
Situated on the north east coast, the Angus glens and the Vale of Strathmore provide a
stunning backdrop to seaside towns and the Angus coastline. The main centres of
population and commerce in Angus are the seven towns of Arbroath, Forfar, Montrose,
Carnoustie, Brechin, Monifieth and Kirriemuir. These towns are complemented by thriving
rural communities and smaller settlements. The map below shows the geographical layout of
the main towns.

                                                    Map 2: Angus




From its agricultural and seafaring origins, the economy of Angus has diversified and
supports strong engineering, textiles, and food processing sectors. In addition to these
traditional industries, oil and gas related businesses, digital media and pharmaceuticals
have become firmly embedded in the economy.

The 2001 Census reported that Angus had a population density of 0.5 persons per hectare.
This places Angus 12 out of the 32 Scottish LA areas in terms of being least densely
populated. The simple definition of a ‘rural’ area is one with a population density of less than
1 person per hectare.10 The advantages of this definition are its simplicity, clarity and the
substantial amount of data available. A limitation is that urban pockets, such as Inverness in
the Highlands, are counted as rural. The more sophisticated Six-Fold Urban Rural
Classification breaks down rural and urban areas as follows.




10 Scottish Executive (2003), Social Focus on Urban Rural Scotland 2003.



                                                                                               1
                    Table 3: Scottish Executive Six-Fold Urban Rural Classification


1. Large Urban Areas                 Settlements of over 125,000 people.

2. Other Urban Areas                 Settlements of 10,000 to 125,000 people.
3. Accessible Small                  Settlements of between 3,000 and 10,000 people and within 30
   Towns                             minutes drive of a settlement of 10,000 or more.
                                     Settlements of between 3,000 and 10,000 people and with a
4. Remote Towns
                                     drive time of over 30 minutes to a settlement of 10,000 or more.
                                     Settlements of less than 3,000 people and within 30 minutes
5. Accessible Rural
                                     drive of a settlement of 10,000 or more.
                                     Settlements of less than 3,000 people and with a drive time of
6. Remote Rural
                                     over 30 minutes to a settlement of 10,000 or more.
Source: Scottish Executive (2003), Urban Rural Classification, 2003-2004, p.11

Categories 1 to 4 are designated as urban, and categories 5 and 6 are rural. The translation
of this to Angus is demonstrated below.

       Table 4: Scottish Government Six-Fold Urban Rural Classification by LA, 2007-08

                            Large            Other         Accessible         Remote
                                                                                            Accessible          Remote
                            Urban            Urban           Small             Small
                                                                                              Rural              Rural
                            Areas            Areas          Towns             Towns
 Aberdeenshire               0.0              26.1            9.8              11.2              36.7            16.0
 Angus                        7.7             53.2             11.8              0.0             26.7            0.7
 Dundee City                  99.7             0.0              0.0              0.0              0.3            0.0
 Perth & Kinross              1.2             31.2              9.8             10.8             34.8            12.3
 Scotland                     38.9            30.3              8.6              4.1             11.2            7.0
Source: Scottish Government (2008), Urban Rural Classification, 2007-2008, p.13

It is important to note that although 7.7% of the population of Angus is classified as a ‘large
urban area’ there are no settlements of this size in the county. One of the criteria used to
produce the Scottish Government 6 and 8 fold urban rural classifications was settlement size
as defined by the General Register Office for Scotland (GROS). The GROS Small Area
Population Estimates together with information from the Royal Mail Postcode Address File
were used to classify 2004 postcode units as high or low density. This information was then
used to select areas of contiguous high density postcodes that make up a settlement.11 As
settlements were defined in this way, some areas of the Dundee Settlement are correctly
included in Angus, accounting for the 7.7% classed as large urban area.

In terms of the population for each of the settlements and localities, the most up to date
information is the GROS 2008 mid year population estimates. These can be seen in the
table below.




11 Details of the methodology can be found at www.gro-scotland.gov.uk/statistics/geography/scosett/index.html



                                                                                                                         2
                       Table 5: Mid-2008 Population Estimates for Localities

                                                                     2008 Population       % of Angus
 Rank            Locality                  Settlement
                                                                        Estimate           Population
   1.     Arbroath                 Arbroath                              22,110               20.1
   2.     Forfar                   Forfar                                13,430               12.2
   3.     Montrose                 Montrose, Settlement of               11,050               10.0
   4.     Carnoustie               Carnoustie                            10,780               9.8
   5.     Monifieth                Dundee, Settlement of                  8,220               7.5
   6.     Brechin                  Brechin                                7,070               6.4
   7.     Kirriemuir               Kirriemuir                             5,750               5.2
   8.     Birkhill &               Birkhill & Muirhead                    2,130               1.9
   9.     Muirhead
          Letham                   Letham                                 1,520               1.4
   10.    Hillside                 Hillside                               1,140               1.0
   11.    Ferryden                 Montrose, Settlement of                1,040               0.9
   12.    Friockheim               Friockheim                              940                0.9
   13.    Edzell                   Edzell                                  900                0.8
   14.    Newtyle                  Newtyle                                 770                0.7
   15.    Wellbank                 Wellbank                                650                0.6
   16.    Dundee (part)            Dundee, Settlement of                   550                0.5
   17.    Liff (part)              Liff                                    450                0.4
                                                                         88,500               80.3
Source: GROS (2010), Mid-2008 Population Estimates for Localities in Scotland

The largest urban area in Angus is Arbroath, which would fall into category two. In terms of
the spatial spread of the total population, the population of Angus breaks down as follows:

                     Table 6: Total Population, by Multi Member Wards (2008)

 Multi Member Ward                               Population                              %
 Monifieth & Sidlaw                                16,373                              14.84
 Arbroath West & Letham                            15,677                              14.21
 Forfar & District                                 15,239                              13.81
 Montrose & District                               15,013                              13.61
 Arbroath East & Lunan                             14,064                              12.75
 Carnoustie & District                             12,404                              11.24
 Brechin & Edzell                                  11,733                              10.64
 Kirriemuir & Dean                                 9,807                                8.89
 Total                                            110,310                               100
Source: Scottish Neighbourhood Statistics (2008), Total Population

In practice, Angus is regarded as neither remote rural nor urban. This means Angus is at
risk of being marginalised from EU, UK and Scottish Government economic policy, as it falls
between two of the main planks of focus for structural fund support as well as the focus on
Metropolitan Regions being promoted by Scottish Enterprise.




                                                                                                        3
                                   Infrastructure: Transport Infrastructure

The Scottish Government aims to ‘promote economic growth, social inclusion and
sustainable development through a safe, integrated and efficient transport network’.12 The
economy depends on people getting to their places of employment and education on time
and safely, people being able to travel efficiently on business, and goods getting to market
quickly.’13 An effective transport infrastructure is a vital for the promotion of economic
growth. It is worthwhile noting that while the transport infrastructure in Angus faces
challenges, it does operate on a largely congestion free basis.            The map below
demonstrates the layout of the major road and transport provision in Angus.

                              Map 3: Principal Transport Network in Angus




                                                                                     (C) CROWN
                                                                                    COPYRIGHT,
                                                                                  ANGUS COUNCIL
                                                                                   LA09023L, 2005.




Source: Angus Council (2009), Angus Local Plan Review, Finalised Plan, p.56

The table below gives details of accessibility to other destinations from Arbroath. Arbroath
was selected because of its central position, and railway station.

                         Table 7: Distances and Travel Duration from Arbroath

Destination                Distance (Miles)         Distance (Km)              By Car                   By Rail
Dundee                           17                       27                   32 mins                  20 mins
Aberdeen                         53                       85                1 hr 20 mins                58 mins
Edinburgh                         77                     124                1 hr 43 mins             1 hr 35 mins
Glasgow                           97                     156                2 hrs 3 mins             1 hr 46 mins
Inverness                        129                     207                2 hrs 59 mins            3 hrs 41 mins
Newcastle                        187                     300                4 hrs 7 mins             3 hrs 35 mins
Manchester                       300                     484                5 hrs 16 mins            6 hrs 43 mins
London                           488                     786                8 hrs 33 mins            6 hrs 39 mins
Source: Distances and travel time by car: The RAC.co.uk. Train times: Trainline.com


12 Scottish Government (2009), Transport (Available from www.scotland.gov.uk/Topics/Transport)
13 Scottish Executive (2005), Submission to the Scottish Parliament, Enterprise and Culture Committee, ‘Business Growth -
the next 10 years’ p.15.



                                                                                                                       4
Key elements of transport and communications infrastructure in Angus include the A90 trunk
road, the A92 (which was recently upgraded to dual carriageway status between Dundee
and Arbroath), other public roads totalling 1,750 km, 37 public car parks, the East Coast
Main Railway Line with 4 rail stations and 3 rail halts, Arbroath Bus Station, Arbroath
Harbour, and Montrose Port.

Montrose Port handles about 700,000 tonnes per annum, can take cargo ships up to 90
metres in length and currently handles agricultural-related cargoes, timber and chemical and
considerable potential for servicing off-shore wind farm developments.

Apart from local and national rail links, the public transport network is mainly bus based,
overlaying parts of the strategic and local road network. The bus based network provides
good connectivity within and between the towns, but in rural areas, and particularly the
Angus Glens, accessibility is limited, although some demand responsive schemes are in
operation.

The National Cycle Route also passes through the coastal towns following mainly minor
roads.14

Direct air travel from Angus is not available. However, there are airports in Dundee,
Aberdeen, Inverness, Edinburgh and Glasgow. Dundee airport offers flights to Belfast,
Birmingham, London City and Jersey. Aberdeen, Glasgow and Edinburgh fly to a wide range
of domestic and international locations. For indications of travel times to these airports,
please see the table above.15

There are several weaknesses in the current infrastructure which will need to be addressed
for it to operate to its full potential. Only one of the Angus Glens, Glen Isla, has a through
road (connecting it to the A93). A further weakness is that there are difficulties for road
freight traffic on some roads, particularly with regard to timber movements on rural roads.

The eastern part of Angus is served by the East Coast Mainline, which connects it directly to
Edinburgh, Glasgow, Aberdeen and key destinations in England (London, Newcastle, Leeds,
Sheffield, Birmingham and Bristol) by direct train services from Arbroath and Montrose.
Tactran (the Tayside and Central Scotland Transport Partnership), as part of the Tay
Estuary Rail Study is promoting an additional hourly service between Arbroath and Glasgow
that would increase frequencies of trains stopping at Carnoustie and Monifieth.

However, the railway line to the immediate south of Montrose is reduced to a single track as
it crosses two substantial viaducts/cuttings. This is the only section of the East Coast
Mainline to remain single track. In addition to this there are currently no rail freight terminals
in Angus or any of its neighbouring LAs.

Transport Scotland’s ‘Strategic Transport Projects Review’, which should be implemented by
2028, recommends several rail service enhancements between Aberdeen and the Central
Belt. As part of the second phase of these proposals, the single track at Usan would be
removed, and a new bridge would be constructed over Montrose Basin. Costs for phase two
are estimated to be between £100 million and £250 million.

The crossing over the Montrose Basin at Usan would potentially impact negatively on the
local environment, and will require careful planning. However, this component if constructed
would provide operational efficiencies and remove the only single track section of the East


14 Angus Council (2005), Angus Local Plan Review, p.28
15 These figures are not for travel times to the respective airports, but rather the cities in general, and should therefore only be
used as an indication.



                                                                                                                                  5
Coast Main Line. The physical works do not use any untried construction, although localised
issues requiring increased technical capabilities to overcome might arise as the design
process progresses. There are a large number of structures along the route for
improvement, including under and over-bridges, viaducts and tunnels. All will need to be
checked to determine the need for suitable upgrade to allow envisaged line speed and
freight gauge enhancements. Additional loops will also be needed to allow freight trains to be
passed.16

The road network has seen substantial improvements have taken place in recent years.
Two of the most significant were completed in 2005. The A92, between Dundee and
Arbroath, was upgraded to dual carriageway status at a cost of £53 million (a project jointly
funded by Angus and Dundee City Councils). The project has improved journey times
between Arbroath, Carnoustie, and Dundee, and has already proven a key factor in
attracting new businesses to Angus.17 A new bridge over the river Southesk at Montrose
was also completed, at a cost of £8.75 million.

The A935 Brechin-Montrose road underwent the first phase of a £9.5 million upgrade in
March 2007. The works covered drainage, reconstruction and resurfacing work between
Dun and Broomley, and cost approximately £370,000.

                  Infrastructure: Information and Communications Technology (ICT)

The Scottish Government is committed to promoting social justice and equality of opportunity
for everyone in Scotland. One of the milestones to achieve the target of ‘reducing
inequalities between communities’ addresses the issue of digital inclusion, being aimed at
‘accelerating the number of households in disadvantaged areas with access to the Internet’.

There is a significant potential role for ICT in promoting local democracy, assisting
teleworking, providing access to financial services, providing vulnerable and isolated people
with access to communication and support networks, and involving those vulnerable to
exclusion in the creative process of developing their own ICT content such as web sites.18

In order for Angus, and especially the rural areas of the county, to be able to fully embrace
the opportunities that ICT can offer, it will be necessary for current services to be
standardised and extended. The new possibilities created by the ICT revolution can and are
having a major effect in terms of economic growth both in urban and rural areas. The
challenge facing rural areas is in how best to facilitate the development of these
technologies, ensuring a digital divide does not form between rural and urban areas.19

The data transmission service was the first telecoms service not obliged to abide by the
terms of the Universal Telephone Service, which ensures non-discriminatory pricing
regardless of location for telephone service, hence disadvantaging rural areas. The
remoteness and lower population of rural areas make the implementation of ICT
infrastructure more difficult and proportionately more costly compared to urban areas. This
has meant that telecoms companies have concentrated initial broadband investment
activities on urban projects.20




16 Transport Scotland (2009), Strategic Transport Projects Review Final Report, Section 23
17 For more information on this, please see article ‘Firms Commit to Westway Retail Site’, Arbroath Herald, 21 July 2006.
18 Gilliatt, J., MacLean, D., & Brogden, J., Lambda Research and Consultancy Ltd, Audit Of ICT Initiatives: In Social Inclusion
Partnerships and Working For Communities Pathfinders In Scotland. The Scottish Executive Central Research Unit (2000), p.8
19 Training And Employment Research Unit (TERU), University Of Glasgow, Rural Economic Development - Physical And ICT
Infrastructure Development, p.1
20 Countryside Agency (2003). Broadband in Rural Areas: Best Practice Study.



                                                                                                                             6
Broadband provision in Angus was slow to take off, with several exchanges not being
upgraded until 2004. All British Telecom (BT) exchanges in Angus are now Asymmetric
Digital Subscriber Line (ASDL) enabled, however, this does not mean that there is equality
of provision. Some exchanges are only capable of providing broadband at a speed of 512
kilobytes per second (kbps). Average speeds of broadband in Scotland are lower than in
every English region.21 In addition to this, there are some locations where broadband is not
available due to the length of the phone line between the workstation and the exchange.
The areas can be seen in the map below.

                Map 4: Areas of Angus without Broadband in 2008 (by Postcode)




Source: Angus Glens Broadband Group (2008)

On 31 March 2006, most of the exchanges UK wide were updated to be compatible with
ADSL MAX. This automatically upgrades the user’s package to the fastest speed possible
for the address. There were only 180 exchanges which were not scheduled for upgrade.
Three were located in Angus, namely Clova, Fern and Menmuir. However, it was
announced by the Scottish Government in December 2009 that 71 exchanges nationwide
were to be upgraded in 2010. The exchanges selected were all operating at or approaching
maximum capacity for broadband provision. Two of the exchanges upgraded were Fern and
Menmuir, and the upgrade was completed by July 2010.22

In 2009, 18.3 million households in the UK (70%) had internet access, compared to 16
million (65%) in 2008. This is an increase of just under 2 million households (11%) over the
last year and 4 million households (28%) since 2006.



21 Ofcom (2009), UK Broadband Speeds 2008: Research Report, p.42
22 Scottish Government (2010), Exchange Activate Upgrade Programme.



                                                                                           7
The UK region with the lowest access level was Scotland, with 62%. In 2006, Scotland was
also the area with the lowest level of access, recording 48%. Although this is a significant
improvement, Scotland still lags behind. 23

The table below demonstrates levels of access to the internet by country from 2006 to 2009,
and the percentage increase since 2006.

                 Table 8: Households with Internet access by country, 2006 - 2009

                                                                      % Change          % Change          % Change
                            2006       2007      2008       2009
                                                                      since 2006        since 2007        since 2008
England                       59        61         66        71           12                10                 5
Wales                         52        57         67        68           16                11                 1
Scotland                      48        60         61        62           14                 2                 1
UK                            57        61         65        70           13                 9                 5
Source: National Statistics (2009), Internet Access 2009

Whilst the number of households in Scotland with internet access has increased since 2006,
the rate of percentage change has not kept pace with England, Wales or the UK.

In the UK, 63% of all households had a broadband connection in 2009. This is an increase
from 56% in 2008, and 51% in 2007. Of those households with internet access, 90% had a
broadband connection in 2009, an increase from 69% in 2006. 24

The Ofcom Communications Market 2008 Report for Scotland shows that 60% of
households in Scotland had a broadband connection in Q1 2009. This is an increase from
53% in Q1 2008.

The report also shows that broadband take-up has grown across Scotland. Since the 2006
survey, broadband take-up in Scotland has risen by 11% to be present in 53% of homes.
This compares to 58% in England, 52% in Northern Ireland and 45% in Wales. However,
there was considerable variation across the country; Aberdeen (64%), Dundee, Edinburgh
and Highlands & Islands (all 62%) were substantially ahead of the UK average of 57%.
Broadband take-up was higher (59%), in Scotland’s rural areas than in urban areas (52%).

The report also suggested that non-ownership of telecommunications services is due to cost
and lack of interest. Consumers who do not have fixed-line phones, mobile phones or
broadband typically say that this is because they do not want them or they are too
expensive. Less than 1% of survey respondents said that lack of service availability was a
reason for not having a broadband connection.25

The results from the 2007/08 Scottish Household Survey reveal a significantly higher
proportion of those living in the 15% most deprived areas of Scotland do not use the internet
compared with those living in the rest of the country (49% and 31% respectively).26

However this is an improvement on the results reported in the 2006 survey which found that
31% of households in the most deprived Scottish Index of Multiple Deprivation (SIMD)
quintile have home internet access compared with 67% of households in the least deprived
SIMD quintile. Of all households in Scotland with a broadband connection, 22% of those

23 National Statistics (2009), Internet Access information, based on the National Statistics Omnibus Survey, and Survey of
Internet Service Providers. Available from www.statistics.gov.uk/cci/nugget.asp?id=8.
24 National Statistics (2009), Internet Access information, based on the National Statistics Omnibus Survey, and Survey of
Internet Service Providers.
25 Ofcom, Nations & Regions Communications Market Reports 2008, Scotland
26 The Scottish Government (2009), Scotland’s People, Results from the 2007/08 Scottish Household Survey, p.95



                                                                                                                        8
come from households with incomes of less than £6,000 increasing to 86% in those with
incomes of over £40,000.27

It is not just domestic broadband that is important. The table below shows that the number
of businesses which have broadband and undertake some business over the internet are
increasing. In addition to this, the percentage of companies that consider e-commerce as
important has almost doubled since 2001.

                 Table 9: Scottish Companies and E-Business Survey, 2001-2007

Companies who:                                      2001      2002      2003      2004    2005   2006   2007
Have a website                                      35%       39%       43%        41%    45%    46%    51%
Have and use internet access                        50%       67%       72%        70%    73%    83%    79%
   - of which have Broadband access                    -       6%       17%        39%    61%    79%    89%
Receive orders over the internet *                  16%       21%       14%        17%    28%    37%    39%
Place orders over the internet *                    32%       33%       32%        40%    44%    56%    55%
Consider e-commerce to be
                                                    37%       51%       55%        56%    60%    68%    67%
important to their current needs
Source: Scottish Government (2009), Scottish Economic Statistics 2008 (covers only the Scottish Enterprise
area) * Derived from the percentage of businesses operating in Scotland who have Internet access.

                                              Local Housing Market

The financial crisis has had a huge impact on the housing market, in Scotland, the UK, and
further afield. Financial institutions became increasingly reluctant to lend money to each
other, businesses, or the public. This lack of fluidity in the financial markets is commonly
referred to as the ‘credit crunch’. This, in turn, has led to a decrease in the number of
houses being built, and the number of mortgages being approved. These 2 factors have
caused the housing market to be more static than it has been for the past few years, which
saw soaring house prices, and new housing projects being completed. In Scotland, new
housing supply (new build, refurbishment and conversions) decreased by 18% between
2007/08 and 2008/09, from 27,500 to 22,600 units. This was driven by a decrease in private
completions.28

In 2008/09, there were 21,400 completions in Scotland, a decrease of 17% on the previous
year, when there were 25,700. Starts in 2008/09 also fell, with a 26% drop from 26,900 in
2007/08 to just 20,000 in 2008/09. The recession has hit the private house building industry
particularly hard, with a 24% reduction in completions and over 30% reduction in starts since
last year. Private starts for 2008/09 were 14,200, falling below levels seen in the early 1990s
to those of 1987/88. In contrast, housing association completions show a 12% increase to
4,600, the third highest number since this was first measured in 1992/93.29

Angus contains four Housing Market Areas (HMAs), namely Arbroath, Montrose & Brechin,
Carnoustie, Monifieth & the Sidlaws, and Forfar, Kirriemuir & the Angus Glens. The
geographical extent of a HMA can be defined as, ‘the area within which people will search
for housing and within which they are willing to move while maintaining their existing


27 Scottish Government (2008), Scottish Household Survey 2007
28 Scottish Government (2009), Housing statistics for Scotland 2009: Key Trends Summary
29 Ibid.



                                                                                                               9
economic and social relationships (i.e. not taking into account the limited amount of long
distance movement associated with such factors as job changes)’.30

The different HMAs in Angus display different characteristics:

     1.        Arbroath
                 Demand for owner-occupation is likely to be met from existing out-moves and
                  new-build;
                 Projections suggest a sufficient supply of social housing to meet needs over
                  the next five years; and
                 Owner-occupiers pay a higher percentage of their incomes on mortgages.

     2.        Montrose and Brechin
                Demand for social renting in Brechin is low; and
                There is evidence of a significant supply of properties at the lower end of the
                 market.

     3.        Carnoustie, Monifieth and the Sidlaws
                 There is continuing high demand for owner-occupation;
                 Housing need for social housing is substantially greater than the supply;
                 Affordability problems are less obvious, although there is still a need for
                  affordable housing options; and
                 In-migration from Greater Dundee Housing Market is influential.

     4.        Forfar, Kirriemuir and the Angus Glens
                 There is healthy unmet potential demand for owner occupation;
                 There is moderate demand for social housing; and
                 Households in this area are less likely to have affordability problems.

                                               Map 5: HMAs in Angus




Source: Angus Council (2004), Angus Local Housing Strategy 2004 – 2009, p.7


30 Communities Scotland (2003), Housing Market Areas in Scotland: definition and review, p. vi



                                                                                                 10
The different areas are not separated by defined borders, and areas tend to ‘shade’ from
one to the other. However, splitting them into areas gives greater value to analysis. Some
key points that research has revealed are:

   66% of property purchasers in Angus come from Angus therefore Angus as a whole can
    be regarded as a relatively self-contained housing market;

   More than 60% of purchasers in the Arbroath, Forfar, Kirriemuir & Glens, and the
    Brechin & Montrose HMAs come from the HMA itself and all 3 are therefore close to
    being fully self-contained;

   The Carnoustie, Monifieth & the Sidlaws HMA is the least self-contained with only 42%
    of purchasers coming from the area;

   Brechin and Montrose HMA is strongly influenced by purchasers from Aberdeen and
    Aberdeenshire, where 17% of all purchasers originated from;

   The South Angus HMA is highly influenced by purchasers from Dundee with 36% of
    properties being sold to purchasers from Dundee;

   Only 2.5% of purchasers come from Perth and Kinross and therefore have little impact
    on the Angus Housing Market;

   26% of properties built between 2002 and 2006 in Angus were sold to purchasers from
    Dundee;

   Almost half of all new-build and recently constructed (2002/2006) properties are sold to
    purchasers from outside Angus. 31

The Angus Council Local Housing Strategy Review 2007/2008 has suggested that the credit
crunch has an impact on several areas of the housing market. There has been a slowing
down of the housing market with falling house prices (this will be dealt with in the following
section). In Angus, average house prices fell from £140,000 in November 2007 to £124,990
in May 2008 and have continued to fall since then. As a consequence, private developers
are building fewer houses and reducing their staff numbers. This situation is likely to have a
big impact on affordable housing and on housing supply as a whole.32

Banks and building societies are either restricting lending or offering less generous rates for
Housing Associations. The Scottish Government has tightened the annual funding that
supports housing associations in affordable housing developments. These factors
discourage housing associations from continuing to build the level of affordable housing
required to deliver what Angus people need.

First time buyers are finding it increasingly difficult to buy property, not solely due to house
prices, but because of the level of deposit required and the limited range of mortgages they
can access. For those people who can secure a mortgage and have liquid assets for
deposits, this is a buyers market. For those who can not or do not, it is a challenge to enter
the property market.

The following table gives an indication of the levels of housing stock, levels of housing stock
held by the LA, and average rent for a council house, in Angus and its neighbouring LAs, in

31 Angus Council (2008), Neighbourhood Services Department, ‘Identifying Housing Market Areas’.
32 Angus Council (2008), Local Housing Strategy Review 2007- 2008, p. 14



                                                                                                  11
comparison to the national average. This information is presented to show the change since
2005/6 to 2008/9.

It can be seen that in Angus, in accordance to the national trend the numbers of Council
owned houses has fallen while the number of dwellings on the Council Tax (CT) register has
increased.

                          Table 10: Housing Stock and Council Rent Levels

                                                  Aberdeen                          Dundee       Perth &
2005/6                                           Scotland                Angus
                                                    shire                            City        Kinross
No of dwellings on CT register          2,417,759 104,226               52,346      72,165       66,252
No of LA dwellings                       363,796 13,963                  8,396      15,638        8,200
As a % of all dwellings the CT register    15%      13%                  16%         22%          12%
Estimated average weekly rent             £44.78   £42.56               £38.68      £46.55       £39.66
2008/9
No of dwellings on CT register          2,462,571 106,850               53,402          73,068   67,896
No of LA dwellings                       322,865 13,059                  7,872          13,961    7,584
As a % of all dwellings on CT register     13%      12%                  15%             19%      11%
Estimated average weekly rent             £50.51   £49.06               £44.02          £52.33   £46.00
Source: Scottish Government (2008), Housing trends in Scotland.

                                           Local Housing Stock.

The table below shows the breakdown of the types and size of dwellings most common in,
Angus, its neighbouring Las, and Scotland. A ‘dwelling’ refers to the accommodation itself,
for example a house or a flat. A ‘household’ refers to the people living together in that
dwelling. The number of households will be smaller than the number of dwellings, as some
dwellings are vacant or second homes.

In general, the density of housing increases as the level of deprivation increases. The most
deprived areas have the highest density of housing, with an average of 15 dwellings per
hectare. The median number of rooms per dwelling is lower in more deprived areas.

                          Table 11: Characteristics of Dwellings by LA, 2008

                                Dwelling type                No of rooms per dwellingMedian
                                                                                             Dwellings
                             (% of total dwellings)                                number of
                                                              (% of total dwellings)
LA                                                                                              per
                                                                                   rooms per
                                    Semi-              Un 1 - 3 4 - 6 7 +      Un             hectare
                  Flats   Terraced          Detached
                                   detached          known rooms rooms rooms known dwelling
Scotland           38        21       20       21      1     42    50    6     1       4       0.32
Aberdeenshire      12        12       30       46      0     28    55    16    0       4       0.17
Angus              26        22       20       32      0     43    48    9     0       4       0.25
Dundee City        54        18       18       10      0     57    39    4     0       3       12.21
Perth & Kinross    26        15       21       37      0     40    49    11    0       4       0.13
Source: GROS (2009), Estimates of Households and Dwellings in Scotland, 2008

The number of households in Scotland continues to increase. This is due partly to a small
increase in population, but mainly to changes in household structure, with more people living
alone. The rate of growth has slowed in the past year. Between 2007 and 2008, the number
of households increased less than in any of the preceding five years.


                                                                                                       12
The number of households in Scotland has been increasing steadily, by between 11,000 and
23,000 each year since 1991. Over the last year, there has been an increase of 17,500
households (0.8%). The number of households has been increasing in every LA, except
Inverclyde. The areas with the greatest increases over the last five years have been in
Highland (8.5%) and Aberdeenshire (8.3%). The rate of increase in Angus was 5%, greater
                                  33
than the Scottish average of 4.6%.

                   Table 12: Household estimates for Scotland by LA, 1991/2008

                                                   Change 2007/2008 Change 2003/2008
LA                       1991          2001           2008
                                                    Number      %    Number      %
Scotland              2,042,809 2,195,033 2,331,250 17,472    0.8%   101,715   4.6%
Aberdeenshire           80,473        90,902        101,516          1,325        1.3%         7,789         8.3%
Angus                   43,806        46,948         49,974           409         0.8%         2,383         5.0%
Dundee City             67,028        66,851         68,381           103         0.2%          996          1.5%
Perth & Kinross         51,692        58,370         64,354          1,121        1.8%         4,469         7.5%
Source: GROS (2009), Estimates of Households and Dwellings in Scotland, 2008.

More people are living alone. There has been a 6% increase in the number of adults living
alone in Scotland in the last 5 years. In Scotland 38% of dwellings are entitled to a CT
discount as there is only 1 adult living there (either alone or with children). There are more 1
adult households in urban areas (42% in large urban areas, compared to 29% in remote
rural areas) and in deprived areas (28% in the least deprived areas, compared to 52% in the
most deprived areas). Across Scotland as a whole 2.8% of dwellings are vacant and 1.4%
are second homes, though there is wide variation. Remote rural areas have the lowest
percentage of dwellings which are occupied (88%), with higher percentages of vacant
dwellings (4% of all dwellings in these areas) and second homes (7%). The most deprived
areas have the highest percentage of dwellings which are vacant (6%). The table below
shows the situation in Angus and its neighbouring LAs.

                            Table 13: Occupied and Vacant Dwellings, 2008

                                                               Dwellings with Dwellings with
                            Total  Occupied Vacant Second
                                                               a single adult   'occupied
                          dwellingsdwellings dwellings34 homes
                                                                 discount     exemptions'35
 Scotland                2,460,883   96%       2.8%       1.4%      38%           2.5%
 Aberdeenshire            106,850    96%       3.1%       1.2%      29%           0.8%
 Angus                     53,402            95%           4.5%         0.8%           36%                 0.9%
 Dundee City               73,068            93%           6.6%         0.9%           43%                 6.1%
 Perth & Kinross           67,896            95%           2.2%         2.5%           34%                 1.4%
Source: GROS (2009), Estimates of Households and Dwellings in Scotland, 2008.

According to research carried out by the Bank of Scotland, the number of vacant homes in
Scotland fell by 5% between 2003 and 2007. There was also a slight fall in the number of
areas with a high level of empty homes, the number of LAs where at least 5% of properties



33 GROS (2009), Estimates of Households and Dwellings in Scotland, 2008.
34 Includes unoccupied dwellings exempt from Council Tax, and dwellings subject to a long-term empty property discount.
35 Includes dwellings that are occupied but exempt from Council Tax. This comprises dwellings only occupied by students,
armed forces accommodation, dwellings which are the sole residence only of people aged under 18 or severely mentally
impaired persons, trial flats used by registered housing associations, and prisons.



                                                                                                                     13
are vacant dropped from 14 in 2003 to 12 in 2007. The level is significant because areas
with a high number of empty homes tend to suffer from deprivation.

Twelve LAs have a proportion of vacant homes that is at least 5% of the dwelling stock.
Vacant homes accounted for 4.1% of all dwellings in Scotland. Twelve LAs have a
proportion of empty homes of at least 5% of the total dwelling stock. Angus is one of these.36
Across Britain, areas which had more than 5% of their dwelling stock vacant, were more
likely to have an unemployment rate above the regional and national average. The majority
also had average weekly earnings below the regional average.37

House prices are lower in areas with an above average number of empty homes. The
average house price is below the Scottish average in 9 of the 12 LAs with a proportion of
vacant homes of at least 5% of the private dwelling stock. Eighty per cent of LAs with more
than 5% of their dwelling stock empty have house prices below the regional average. Ten
out of the 12 LAs with the highest proportions of vacant homes have levels of average
earnings that are below the Scottish average; 5% below on average.38

The tables below show the situation in 2001 and 2008. It can be seen that the number of
vacant properties in Angus has decreased, the percentage of its vacant properties has
increased and it has moved up 5 rankings. However, its situation has not worsened to the
same extent as Dundee City or Perth and Kinross. It is acknowledged that the TAYplan
Strategic Development Planning Authority (SDPA) area (comprising Dundee City, Perth &
Kinross, Angus and north Fife) has the highest percentage of vacant dwellings (4.2%). In the
other SDPA areas, the proportion of vacant dwellings is near the national average of 2.8%.39

                       Table 14: Scottish LAs with Vacant Dwelling Stock (2001)

                                        Vacant                  Total             Vacant Dwellings            Ranking
 LA
                                       Dwellings              Dwellings             as % of total            (out of 32)
 Angus                                  2,418                  49,900                   4.8                      11
 Dundee City                              3,147                 70,179                      4.5                    12
 Aberdeenshire                            4,182                 96,619                      4.3                    13
 Perth & Kinross                          2,422                 62,709                      3.9                    17
Source: GROS (2000), Estimates of Households and Dwellings in Scotland, 2001.
(Rankings: With No. 1 having the most vacant dwellings, and No. 32 the least)

                       Table 15: Scottish LAs with Vacant Dwelling Stock (2008)

                                        Vacant                  Total             Vacant Dwellings            Ranking
 LA
                                       Dwellings              Dwellings             as % of total            (out of 32)
 Dundee City                            4,794                  73,068                   6.6                       2
 Angus                                    2,392                 53,402                      4.5                    6
 Aberdeenshire                            3,308                106,850                      3.1                    10
 Perth & Kinross                          1,503                 67,896                      2.2                    24
 Scotland                                69,933               2,460,883                     2.8
Source: GROS (2009), Estimates of Households and Dwellings in Scotland, 2008



36 The difference between this figure and the one reported in the table above is due to different sources and time lag between
the two publications. However, the 0.5% difference is minimal, and allows for useful comment to be made.
37 Lloyds Banking Group (2008), ‘Over 1,000,000 vacant properties in Scotland’, (November 2008), p.5. Available from:
www.lloydsbankinggroup.com/media/pdfs/ 01_11_08EmptyHomesScot.pdf
38 Lloyds Banking Group (2008), ‘Over 1,000,000 vacant properties in Scotland’, (November 2008), p.5.
39 GROS (2009), Estimates of Households and Dwellings in Scotland, 2008



                                                                                                                           14
                                          House Prices and Turnover

The average house price in the UK stood at £205,598 in March 2010. The average house
prices for the different countries were;

               £212,266 in England;
               £174,172 in Northern Ireland;
               £165,106 in Scotland; and
               £150,648 in Wales.

UK house prices were 9.7% higher than in March 2009 and 0.7% higher than in February
2010. UK house prices rose by 2.8% in Q1 2010. This compares with a rise of 2.9% for Q4
2009. Annual average house prices rose in England (10.1%), Scotland (7.2%) and Wales
(8.1%) but fell in Northern Ireland (-6.9%).40

There were 147 transactions in Angus in May 2010. This is 47% higher than the previous
month and 65% higher than a year ago. It is 26% below the average for the same month
over the last 3 years. The average house price in Angus is 3% higher than a year ago at
around £142,576. This compares to a Scottish average house price of £151,100.41

House prices and turnover in Angus vary from town to town, as can be seen in the graphs
below. When considering this it is important to bear in mind the influencing factors present
in the different HMAs, discussed previously.

                                        Figure 1: Angus House Prices42
 £180,000
                                                                                                £162,702
                                                        £148,329
 £160,000
                  £129,282                                           £129,231      £139,051                   £129,398
 £140,000
                             £119,533     £121,176
 £120,000

 £100,000

   £80,000

   £60,000

   £40,000

   £20,000

           £0
                    Angus    Arbroath      Brechin     Carnoustie      Forfar      Kirriemuir    Monifieth    Montrose
Source: Zoopla! (2009), Home values.




40 The Department of Communities and Local Government Mix Adjusted House Price Index, May 2010
41 Scottish Government (2010), Local Authority Housing Bulletin
42 The information below has been calculated from the Zed-Index!, which is the average home value in a given area based on
current Zoopla! Estimates. The Turnover is calculated by dividing the number of sales over the last 5 years (excluding new
build properties) by the number of homes in a given area.



                                                                                                                         15
                        Figure 2: Levels of Housing Turnover in Angus
     30%
                                                   26.2%
     25%                                                                                                   22.6%
                                     22.0%                                                    21.1%
             20.0%      17.6%                                    17.1%         17.4%
     20%

     15%

     10%

     5%

     0%
            Angus      Arbroath      Brechin     Carnoustie     Forfar       Kirriemuir   Monifieth       Montrose
Source: Zoopla! (2009), Levels of Housing Turnover.

House prices in Angus are lower than the Scottish average. This is detailed in the tables
below. In 2006, out of the 32 LAs in Scotland, Angus was ranked number 17 in terms of the
average price, with number 1 being the area with the highest average house price. By 2008,
its ranking had risen to 12 out of 32; however this fell back to 15 in 2009.

The tables below show the impact that the current financial crisis has had on the housing
market. The number of house sales in Angus has dropped from 592 for Q2 2006, to 430 for
Q4 2008, to 308 in Q1 2010. However all areas below have recorded an increase in house
prices over the year to Q1 2010, which might point towards the first signs of a recovery in the
housing market.

             Table 16: LA Rankings – House Prices Scotland (April – June 2006)

                          Ranking            Average           Change in         Change in
  Area                                                                                                No. of Sales
                         (out of 32)         Price (£)        last quarter        last year
 Scotland                                      130,681            5%                11.1%               35,239
 Perth and Kinross              6              145,293           1.1%               20.2%                 990
 Aberdeenshire                  7              140,508          10.5%               17.5%                1,335
 Angus                          17             118,472           3.1%               11.3%                 592
 Dundee City                    27             102,025           0.3%               16.6%                 873

         Table 17: LA Rankings – House Prices Scotland (October – December 2008)

                          Ranking            Average           Change in         Change in
 Area                                                                                                 No. of Sales
                         (out of 32)         Price (£)        last quarter        last year
 Scotland                                      153,623            0%                -3.0%               19,240
 Aberdeenshire                  4              194,339          -2.5%               -2.2%                1,134
 Perth and Kinross              9              170,523          -5.0%               -9.2%                 534
 Angus                          12             153,123           2.7%                  2.8%               430
 Dundee City                    28             116,329          -5.6%               -13.1%                408




                                                                                                                   16
             Table 18: LA Rankings – House Prices Scotland (January - March 2010)

                                 Ranking           Average            Change in          Change in
 Area                                                                                                      No. of Sales
                                (out of 32)        Price (£)         last quarter         last year
 Scotland                                          147,854              -5.0%                5.4%              14,662
 Aberdeenshire                       4             182,586              -6.6%                1.4%               823
 Perth and Kinross                   7             166,395              -6.6%                12%                413
 Angus                              14             138,864              -4.3%                5.4%               308
 Dundee City                        23             123,650              -7.6%                1.2%               392
                                                                                                          43
Source: Registers of Scotland Executive Agency (2009), Latest House Price Statistical Releases.

                                                     Council Tax

CT levels have been historically lower in Angus than in most of the rest of Scotland. This
trend has continued to 2009/10. The table below demonstrates how Angus compares to its
neighbouring LAs and the Scottish average, in terms of its CT charges. CT increases in
Scotland have been frozen since 2007/8.

                                  Table 19: CT Banding Levels 2005/06 (£)

LA                     Band A Band B Band C Band D Band E Band F Band G Band H
Aberdeenshire             710         828          947         1,065       1,302        1,538        1,775        2,130
Angus                     691         807          922         1,037       1,267        1,498        1,728        2,074
Dundee                    787         918         1,049        1,180       1,442        1,704        1,967        2,360
Perth & Kinross           725         846          967         1,088       1,330        1,572        1,813        2,176
Scotland                  730         851          973         1,094       1,338        1,581        1,824        2,189
Source: COSLA (2005), Council Tax Banding Levels 2005/06.

                                  Table 20: CT Banding Levels 2009/10 (£)

LA                     Band A Band B Band C Band D Band E Band F Band G Band H
Aberdeenshire             761         887         1,014        1,141       1,395        1,648        1,902        2,282
Angus                     715         834          953         1,072       1,310        1,548        1,787        2,144
Dundee                    807         942         1,076        1,211       1,480        1,749        2,018        2,422
Perth & Kinross           772         901         1,029        1,158       1,415        1,673        1,930        2,316
Scotland                  758         885         1,011        1,138       1,390        1,643        1,896        2,275
Source: Scottish Government (2009), Council Tax Data

CT bandings reflect the Regional Assessor’s opinion of the property’s open market value as
at 01 April 1991, but taking account of its physical state and its locality as at 1 April 1993.
The table below demonstrates the situation in Angus in 2005/6 and 2008/9.




43 Differences in the average Angus value between the figures taken from Zoopla and the Registers of Scotland can be
attributed to a time lag between the two measurements being recorded, and therefore, are not directly comparable, but rather
snapshots of the housing market at a particular time.



                                                                                                                         17
                             Table 21: CT Breakdown of Properties in Angus

                                                         2005/6                 2008/9
                                                 Total No of % of Angus Total No of % of Angus
Band Range                                  Band
                                                 Properties    homes    Properties    homes
Up to and including £27,000                  A     15,468        30       15,214       28.8
Above £27,000 up to £35,000                   B        12,241              23.7            12,341             23.3
Above £35,000 up to £45,000                   C         6,534              12.7            6,686              12.6
Above £45,000 up to £58,000                   D         7,401              14.3            7,705              14.6
Above £58,000 up to £80,000                   E         6,374              12.3            6,797              12.8
Above £80,000 up to £106,000                  F         2,283              4.4             2,671               5.0
Above £106,000 up to £212,000                 G         1,167              2.3             1,348               2.5
Above £212,000                                H          146               0.3               156               0.3
                                                       51,614              100             52,918             100
Source: Angus Council (2006), Annual Accounts – 2005/2006, Council Tax Income Statement, p.25.
        Angus Council (2009), Annual Accounts – 2008/2009, Council Tax Income Account Notes, p.44.

In April 2010, in relation to CT Benefit, Angus rated 18 out of the 32 LAs in terms of the
highest number of claimants, with 10,160 people in receipt.44

                                                        Crime.

The Angus Council area falls under the responsibility of Tayside Police. It is also
responsible for the Dundee City Council and Perth & Kinross LAs. The Eastern Division are
responsible for policing Angus.

The number of recorded crimes in the Tayside Police Force area decreased for the fourth
consecutive year and overall by 3% in 2008/09 to 26,047.

The most significant decrease was the 9% decline in the number of fire-raising and
vandalism crimes on the previous year. This was the fourth year in succession Tayside has
experienced a drop in recorded crimes for this particular crime group. The most considerable
increase was the 14% rise in the number of non-sexual crimes of violence recorded in
2008/09. This increase came on the back of an 8% decrease the previous year.

The number of offences recorded by Tayside Police fell in both categories for the second
consecutive year and the overall total by 17% compared with 2007/08. The largest of these
decreases occurred in the motor vehicle offences group (-22%). The number of offences
recorded by Tayside Police for this particular category has continued to fall since 2004/05.

In 2008/09 Tayside experienced increases in the clear-up rates for 4 of the 5 main crime
categories compared with last year.45

Tayside saw an increase in non-sexual crimes of violence in 2008/09 and this was mainly
due to child cruelty cases which had previously been recorded as 1 crime where there were
2 or more victims. This has been rectified. Two other crimes within this classification, serious
assault and robbery continue to be the focus of the Force's crime reduction efforts.



44 Department of Work and Pensions (2010), Housing Benefit and Council Tax Benefit Quarterly Summary Statistics.
45 Angus Council (2009), Statistical Bulletin – Crime And Justice Series 2008/09



                                                                                                                     18
Crimes of indecency are a volatile group of crimes and a fluctuation in numbers is not
uncommon. However, there were less historical instances of indecent assault reported in
Tayside during 2008/09 than in the previous year.

The number of crimes in Tayside relating to theft by opening lockfast places increased by
24% in 2008/09 due to several instances of cash cards being stolen and used over a period
of time at various locations to obtain cash.

High levels of crime relating to theft from a motor vehicle during 2007/08 (particularly in
December and February) were due to many vehicles being targeted for satellite systems and
audio visual equipment.

The reductions in motor vehicle offences (-22%) in Tayside occurred, predominantly, in
speeding and seat belt offences.

In 2007/08 there was a fall in the number of possession of drugs charges due to activity
being concentrated on long running high level drugs operations targeting organised crime
groups. Whilst this activity continued into 2008/09 the level of possession of drugs offences
reverted to a similar level to 2006/07.

The 22% fall in the number of crimes against Public Justice in 2008/09, in the main, can be
attributed to a fall in bail offences. Tayside Police initiatives in earlier years have produced
high results and sent out the message that contravention of bail conditions would not be
tolerated. It was inevitable (and desirable) that these numbers would fall as time progressed
and offenders learned to take their conditions of bail seriously.46

Levels of crime in Angus are lower than the national average. In 2007/08, within Tayside,
crime rates varied from 505 per 10,000 in Angus, 485 in Perth and Kinross, and to 1,018 in
Dundee compared to 749 for Scotland as a whole.47 By 2008/09, these figures were 537 per
10,000 in Angus, 473 in Perth & Kinross, 934 in Dundee City, compared to 730 for Scotland
as a whole. This means that there was a rise in the number of crimes recorded per 10,000
of population in Angus, but a fall for the other areas.

The tables below illustrate the situation in Angus, and the other LAs in Tayside, as well as
comparing the information to the national average. It is important to bear in mind that the
numbers of crimes reported to the Police are lower than the actual number of crimes
committed, and due to the nature of criminal activity, it is not known by how many.




46 Scottish Government (2009), Statistical Bulletin Crime and Justice Series: Recorded Crime in Scotland, 2008/09, p.14
47 Scottish Government (2009), Statistics On Crimes And Offences Recorded And Cleared Up By The Eight Scottish Police
Forces In 2008/9, p.22



                                                                                                                    19
Table 22: Number Of Crimes Recorded by the Police and % Cleared up, 2005/06 - 2008/09

                                                                                   Perth &
                    Aberdeenshire              Angus         Dundee City                            Scotland
                                                                                   Kinross
                     05/06     08/09    05/06     08/09     05/06     08/09     05/06 08/09       05/06   08/09
 Non sexual
 crimes of            264       206       97       139       374       373       105     184     13,726   12,612
 violence
 Crimes of
                      242       227       97       101       296       229       130      94      6,558   6,331
 indecency
 Crimes of
                     4,985     3,554    2,566     2,534     8,057     7,083     3,420    3,207   187,798 167,812
 dishonesty
 Fire raising,
 vandalism,          4,310     3195     1,904     1,924     3,735     3,067     2,480    1,613   127,889 109,430
 etc.
 Other crimes        1,544     1,547    1,237     1,228     3,131     2,549     1,823    1,722   81,814   81,248
 Total crimes       11,345 8,729        5,901     5,926 15,593 13,301 7,958              6,820   417,785 377,433
 % cleared up          35        47       60        59        56        56        59      62       46      49
Source: Scottish Executive, Statistics On Crimes And Offences Recorded And Cleared Up By The Eight Scottish
Police Forces In 2005/06 & Scottish Government, Statistics On Crimes And Offences Recorded And Cleared Up
By The Eight Scottish Police Forces In 2008/09.

           Table 23: Number of Crimes Recorded by the Police per 10,000 Population
                             and Crime Index, 2005/06 - 2008/09

                    Aberdeenshire              Angus         Dundee City Perth & Kinross            Scotland
                     05/06     08/09    05/06     08/09     05/06     08/09     05/06    08/09    05/06   08/09
 Non sexual
 crimes of             11        9         9        13        26        26        8       13       27      24
 violence
 Crimes of
                       10        9         9           9      21        16        9       7        13      12
 indecency
 Crimes of
                      212       147       235      230       567       497       247     222      369      325
 dishonesty
 Fire raising,
 vandalism,           183       132       174      174       263       215       179     112      251      212
 etc.
 Other crimes          66        64       113      111       220       179       132     119      161      157
 Total crimes         482       537       541      537      1,097      934       575     473      820      730
 Index                 59        74       66        74       134       128        70      65      100      100
Source: Scottish Executive, Statistics On Crimes And Offences Recorded And Cleared Up By The Eight Scottish
Police Forces In 2005/06 & Scottish Government, Statistics On Crimes And Offences Recorded And Cleared Up
By The Eight Scottish Police Forces In 2008/09. [Scotland = 100 in Index].

The level of drug crime in Angus is low. The number of crimes recorded per 100,000
population in 2008/09 was 602 compared with 822 for Scotland as a whole.48 The table and
figure below show the number of drug-related offences recorded by Scottish Police forces
between 2003/04 and 2008/09. The LA given is where the offence was detected or
reported.




48 Drug Misuse Information Scotland (2010) Drug Misuse Statistics Scotland 2009, p.166



                                                                                                                  20
Table 24: Number and Rate per 100,000 Population of Drug-Related Offences Recorded by
                      Scottish Police Forces: 2003/04 - 2007/08

              2003/04         2004/05          2005/06          2006/07         2007/08         2008/09
              No     Rate     No     Rate      No      Rate    No       Rate    No     Rate    No       Rate

Scotland    42,275 836 41,823 824 44,247 868 42,422 829 40,746 792 42,509 822
Aberdeen
              731    320      791     342     864      370     659      279    883       369   812      336
shire
Angus         574    534      617     569     678      623     658      602    494       450   664      602
Dundee
             1,407 982 1,553 1,092 1,582 1,111 1,445 1,016 1,252 881 1,503 1,055
City
Perth &
             1,103 811 1,280 931 1,063 767 1,021 728                           801       564   996      691
Kinross
Source: Drug Misuse Information Scotland (2010) Drug Misuse Statistics Scotland 2009, p.166

   Figure 3: Rate per 100,000 Population of Drug-Related Offences Recorded by Scottish
                             Police Forces: 2003/04 - 2008/09
1,200


1,000


 800


 600


 400


 200
              Aberdeenshire          Angus       Dundee City            Perth & Kinross        Scotland
    0
            Rate            Rate              Rate             Rate             Rate             Rate
           2003/04         2004/05           2005/06          2006/07          2007/08         2008/09
Source: Drug Misuse Information Scotland (2010) Drug Misuse Statistics Scotland 2009, p.166

It can be seen that between 2003/04 and 2008/09, the rates of drug related offences has
fallen in Scotland overall, but has increased in Angus and all of its neighbouring LAs.




                                                                                                          21
 Chapter Two                The People
                                                     Population

The total population of Angus is approximately 110,000. Of that number, 51.6% are female
and 48.4% are male, which is slightly higher than the Scottish average.49 The table below
shows the age breakdown of the population.

                                     Table 25: Population by Age, 2009

                                                        Angus                                Scotland
                                                No. (000s)             %             No. (000s)        %
  Total population                                 110               100%              5,194         100%
    Below working age                               20                18%               912           18%
    Of working age                                  64                58%              3,249          63%
    Above working age                               26                24%              1,033          20%
Source: Scottish Government Analytical Service Division (2010), Angus Economic Briefing.

The population of Angus, based on 2008 projections, is projected to increase steadily to
2033. This differs from the 2006 based projections, which predicted that the population
would increase slightly to 2021, and thereafter remain static until 2031, whilst the Scottish
population continued to grow, reducing the percentage of the national population that Angus
is accountable for. These projections can be seen below.

                 Table 26: Projected Population Changes (2006 based projections)

      Year                 Angus              Angus as a % of Scotland’s population              Scotland
      2006                109,000                                   2.13                         5,117,000
      2011                111,000                                   2.13                         5,206,000
      2016                113,000                                   2.14                         5,270,000
      2021                114,000                                   2.14                         5,326,000
      2026                114,000                                   2.13                         5,363,000
      2031                114,000                                   2.12                         5,374,000
Source: GROS (2008), 2006 based Population Projections

                 Table 27: Projected Population Changes (2008 based projections)

      Year                 Angus              Angus as a % of Scotland’s population              Scotland
      2009                110,694                                   2.13                         5,189,094
      2013                112,420                                   2.13                         5,271,006
      2017                113,952                                   2.13                         5,342,064
      2021                115,484                                   2.13                         5,411,102
      2025                116,885                                   2.14                         5,470,259
      2029                118,012                                   2.14                         5,514,995
      2033                118,774                                   2.14                         5,544,410
Source: GROS (2010), 2008 based Population Projections




49 GROS (2008), Summary Statistics for Council Areas – Angus (as at 30 June 2008).



                                                                                                             22
The 2004 based projection anticipated a reduction of 4,402 (-4.1%) persons in Angus to
2024. The 2006 based projection expects an increase of 4,813 (4.4%) to 2024. This is a
significant shift in the GROS estimate. The 2008 based projections predict a greater rise in
the population of 8,080 (7.3%). The 2008 based population projections predict that the
population will increase in 19 of the 32 LAs.

Scotland’s estimated population on 30 June 2007 was 5,144,200, a rise of 27,300 on the
previous year and the highest since 1983. On the 30 June 2009 it was 5,194,000, an
increase of 49,800 since 2007. The population of Scotland is projected to rise from
5.19 million in 2009 to 5.54 million in 2033 – an increase of 6.8% over the period. 50 The
population of Angus is expected to increase from 110,694 in 2009 to 118,774 by 2033 - an
increase of 7.2%. The break down of the projected increases can be seen below.

                 Table 28: Projected Population Increases in Angus and Scotland

     Year                Angus                 % increase            Scotland       % increase
     2009               110,694                     --               5,189,094           --
     2013               112,420                     1.6              5,271,006          1.6
     2017               113,952                     1.4              5,342,064          1.3
     2021               115,484                     1.3              5,411,102          1.3
     2025               116,885                     1.2              5,470,259          1.1
     2029               118,012                     1.0              5,514,995          0.8
     2033               118,774                     0.6              5,544,410          0.5
Source: GROS (2010), 2008 based Population Projections

More significant are the projected changes to the age structure. The rank in the table below
refers the projected increase in the population figure overall. The LA with the highest rank
(1) has the highest level of population increase, while the lowest rank (32) has the largest
rate of population decrease projected. Every LA will have more elderly people.

                Table 29: Projected Percentage Change in Population, 2008 - 2033

                                                          Children       Working    Pensionable
                        Rank          All ages
                                                           (0-15)         Ages1       Ages1
 Scotland                  --            7.3                -1.5           2.2         31.4
 Perth & Kinross           2            26.9                24.4           22.8         39.4
 Aberdeenshire             5            22.3                10.6           12.8         64.9
 Angus                    13             7.7                0.4            -0.7         34.4
 Dundee City              26            -5.1                -7.8           -8.6          7.6
1 Includes the change in women's state pension age between 2010 and 2020 and the subsequent change of
both male and female state pension age to 66 by 2026
Source: GROS (2010), 2008 based Population Projections

The figure below shows the projected change in population by LA area. This shows that,
overall, to the year 2033, it is thought that Angus will see a greater increase in population
than the projected national increase. The projected increase in numbers in Angus and Perth
and Kinross is attributable to in-migration, despite fewer births than deaths.51



50 GROS (2009), Key facts
51 GROS (2010), 2008 based Population Projections



                                                                                                   23
       Figure 4: Percentage Change in Population (2008 based) by Council area to 2033
  40



  30



  20



  10



   0



 -10



 -20



 -30




          Edinburgh, City of




            Perth & Kinross
           Scottish Borders
           Shetland Islands
              Argyll & Bute




             Aberdeen City
               Dundee City




             Orkney Islands
       West Dunbartonshire




             North Ayrshire


             South Ayrshire
       Dumfries & Galloway
              East Ayrshire
              Glasgow City




         South Lanarkshire




              West Lothian


               East Lothian
         East Renfrewshire




          North Lanarkshire
                 Eilean Siar




                      Moray




                      Angus




                     Falkirk
                 Midlothian

                     Stirling




                         Fife
              Renfrewshire




                   Highland
             Aberdeenshire
                 Inverclyde




         Clackmannanshire
               SCOTLAND
       East Dunbartonshire




Source: GROS (2010), 2008 based Population Projections.

The projected increase of the population in Angus looks likely to be coupled with an increase
in numbers of those who are above working age. The impact of this is likely to be significant.
It will present challenges for social work and health organisations, as well as for economic
development agencies, who will face consequences in terms of the changing demographics
and dynamics of the labour market (a shrinking and aging of labour force). In addition to
this, while life expectancy has increased steadily over the past 10 years, healthy life
expectancy has not increased at the same rate, placing an additional burden on existing
welfare and health care services.52

The table and graph below demonstrate that Angus already has lower levels of working age
people than Scotland and Great Britain.

                           Table 30: Working Age Population in Angus (2008)

                                     Angus (No’s)           Angus (%)           Scotland (%)            GB (%)
 All people – working age                64,900                 58.8                 62.6                 62.0
 Males – working age                     33,900                 63.5                 66.9                 66.1
 Females – working age                   31,100                 54.4                 58.7                 58.1
Source: Nomis (2010), Labour Market Profile, Midyear population estimates 2008.



52 GROS (2006), Strategy For A Scotland With An Ageing Population, Policy Briefing Paper On Demography, p.1



                                                                                                                 24
                                                                 Figure 5: Age Structure of the Population
 8

 7

 6

 5

 4
  %
 3
                                                                                                    Scotland                                        Angus
 2

 1

 0
               0-4

                           5-9

                                   10 - 14

                                             15 - 19

                                                       20 - 24

                                                                 25 - 29

                                                                           30 - 34

                                                                                     35 - 39

                                                                                                 40 - 44

                                                                                                           45 - 49

                                                                                                                     50 - 54

                                                                                                                                55 - 59

                                                                                                                                          60 - 64

                                                                                                                                                    65 - 69

                                                                                                                                                                70 - 74

                                                                                                                                                                          75 - 79

                                                                                                                                                                                    80 - 84

                                                                                                                                                                                              85 - 89

                                                                                                                                                                                                         90+
                                                                                                     Age Range

Source: GROS (2010), Mid-2009 Population Estimates Scotland

Due to differences in demographic patterns, projected trends differ for the four countries of
the UK. According to the 2004 based population projections, Scotland was the only country
which was expected to face population decline to 2031, while populations of the other 3
countries were projected to rise to 2031, and continue rising except for Northern Ireland
where the population is projected to peak in 2033 and then slowly decline.

However, the 2006 based population projections show the populations for all 4 countries
growing, although growth in Scotland is not as marked. The 2008 based projections show
that the revision to the Scottish projection is the most significant. While growth is still
predicted in all nations, the change for Scotland since the 2006 based projections shows the
greatest increase.

                                 Figure 6: Comparison of Population change for UK countries, 2006 - 2031
                     120

                                              England                         Northern Ireland                                 Wales                          Scotland


                     115
Index (2006 = 100)




                     110




                     105




                     100
                       2006                             2011                                   2016                            2021                                 2026                                2031
Source: GROS (2008), 2006 based Population Projections.




                                                                                                                                                                                                           25
                      Figure 7: Comparison of Population change for UK countries, 2008 - 2033
             120

                               England         Northern Ireland      Wales          Scotland

             115
 Index (2008 = 100)




             110




             105




  100
     2008              2013               2018                    2023           2028           2033
Source: GROS (2010), 2008 based Population Projections.

The number of people of working age in Scotland is projected to increase from 3.24 million in
2008 to 3.36 million in 2018 (+4%). It is then projected to fall to 3.31 million in 2033 (an
increase of 2% compared to 2008). According to the 2004 based population projections, the
working age population was projected to increase in only 3 LAs. The 2006 based projection
anticipated an increase in working age population in 14 LAs by 2031. The 2008 based
projections revised this to 15 LAs.

For Scotland as a whole, it is expected that between 2008 and 2018 the number of children
aged under 16 will increase by 1% from 0.91 to 0.92 million. It is then projected to decrease
to 0.90 million in 2033 (a 1.5% decrease compared to 2008).

The number of people of pensionable age is projected to rise from 1.02 million in 2008 to
1.07 million in 2018 (6%). It is then projected to rise more rapidly, reaching 1.34 million by
2033 (a 31% increase compared to 2008). The number of people aged 75 and over is
projected to increase by 23% from 0.39 million in 2008 to 0.48 million in 2018. It is then
projected to continue rising, reaching 0.72 million by 2033 - an increase of 84% over the 25
year period.

This is a significant revision. The following graph depicts the situation in Angus based on
both the 2008 based projections.




                                                                                                  26
  Figure 8: Projected Population in Angus, by Age Group (000’s), 2008 – Based Projection
 35


 30


 25


 20


 15


 10


  5
                        0-15         16-29         30-49        50-64           65-74       75+
  0
  2008                    2013                   2018                    2023                   2028                   2033
Source: GROS (2010), 2008 based Population Projections.

A useful summary measure of the age structure of a population is the population
dependency ratio - the ratio of persons aged under 16 or over pensionable age to those of
working age. In 2008, the dependency ratio for Scotland was just less than 0.6, meaning
that there were 60 people aged under 16 or of pensionable age per 100 people of working
age. Based on 2008 population projections, the dependency ratio is expected to rise to 68
per 100 in 2033.

According to the 2004 based projections, the figure for Scotland was expected to have risen
slightly to 63 per 100 by 2024. However, at LA level, Angus would have had the third
highest ratio in Scotland (80 per 100).53 This was revised by the 2006 based projections to
show a slow rise from around 59 per 100 in 2006 to 62 per 100 in 2026. Between 2026 and
2031 the dependency ratio was projected to increase to 67 per 100. The relatively slow
increase in the dependency ratio was partly due to changes to the state pension age.

According to the 2006 based projections, the 59 dependents per 100 working age population
were made up almost evenly by children (29 per 100) and pensioners (31 per 100). By 2031
this is projected to have changed to 27 children and 40 pensioners per 100 population of
working age. This means there will be fewer people to joining the working age population in
future years.54

The expectation of life at birth in Scotland has improved over the last 20 years. It has
increased from 69.3 years for males and 75.5 years for females born in the period 1981/83
to 74.8 years and 79.7 years respectively for those born in 2005/07, an increase of 5.5 and
4.2 years respectively.55

The following table shows that life expectancy in all LAs has increased since 1996/98. The
increase in Angus has not kept pace with the national average, and Angus has dropped from
6 in the rankings to 9. The LA with the highest age of life expectancy is ranked number 1.

53 GROS (2006), 2004 based Population Projections. The figures take into account the incremental change, during the 2010 to
2020 period, in the pensionable age for women.
54 GROS (2008), 2006 based Population Projections
55 GROS (2007), Life Expectancy for Administrative Areas within Scotland, 2005-2007



                                                                                                                        27
      Table 31: Life Expectancy at Birth 2006/08, with comparisons to 1996/98 (Persons)

                                   1996/98                   2006/08
                                                                                 Difference in years % change
                              Years           Rank      Years          Rank
 Scotland                      75.3            -         77.5            -                 2.2                    2.9
 Aberdeenshire                 77.7            2         79.3            4                 1.6                    2.1
 Angus                          77             6         78.7            9                 1.8                    2.3
 Dundee City                   74.6            25        76.8           25                 2.2                    3
 Perth & Kinross               76.9            7         79.6            3                 2.7                    3.5
Source: GROS (2009), Life Expectancy for Administrative Areas within Scotland, 2006/2008

Life expectancy by gender can be seen below. The table shows how many more years a
person can be expected to live once they have reached 65. The difference in years between
men and women in Angus is 1.9, which is positive in comparison with the other LAs, and the
national average. However when it comes to the difference in the rankings between males
and females the discrepancy in Angus is 11 rankings, compared to a discrepancy of 3 in
Aberdeenshire, 3 in Perth and Kinross, and 1 in Dundee.

                Table 32: Life Expectancy (with rank) at age 65 in Scotland, 2006/08

                                                                                                         Difference –
                               Persons                   Males                   Females                males & females
                          Years        Rank          Years      Rank           Years     Rank           Years     Rank
 Scotland                  17.7           -          16.3          -           18.9            -         2.6          -
 Aberdeenshire             18.6           6          17.6          4           19.5        7             1.9          3
 Angus                     18.5           7          17.4          5           19.3       16             1.9       11
 Dundee City               18.2          14          16.9          15          19.4       14             2.5          1
 Perth & Kinross           18.9           4          17.6          3           19.9        6             2.3          3
Source: GROS (2009), Life Expectancy for Administrative Areas within Scotland, 2006/2008

The following table details life expectancy at birth. Life expectancy for males and females in
Angus is consistently higher than the national average.

  Table 33: Life expectancy at birth in Scotland 2006/2008, (Persons, Males and Females)

                                  Persons                              Males                            Females
                       1995/7 2005/07 2006/08 1995/7 2005/07 2006/08 1995/7 2005/07 2006/08
Scotland                75.2       77.4         77.5        72.3        74.8      75           77.9       79.7     79.9
Aberdeenshire           77.7       79.4         79.3        75.1        77.5      77.5         80.2       81.3     81.1
Angus                   76.5       78.2         78.7        74.1        76        76.8         78.8       80.5     80.6
Dundee City             74.6       76.6         76.8        71.5        73.8      73.7         77.4       79.4     79.7
Perth & Kinross         76.5       79.1         79.6        73.9        76.9      77.5             79     81.2     81.5
Source: GROS (2007 & 2009), Life Expectancy for Administrative Areas within Scotland, 2005-2007 & 2006-2008

Expected years of life in good health are 69.4 for males and 72.7 for females (the Scotland
average is 66.3 and 70.2 respectively).56

56 Scottish Public Health Observatory Team (2008), Health and Wellbeing Profile - Angus 2008



                                                                                                                          28
                                               Health and W ellbeing

The all cause and heart disease (under 75s) mortality rates in Angus are significantly better
than the Scottish average. Cancer mortality (under 75s) is amongst the second lowest of the
40 Community Health Partnerships (CHPs).

In Angus it is estimated that 25.2% of adults smoke, compared to 27.3% nationally. There
were 125 alcohol related deaths in the last 5 years, significantly below the Scottish average.
The proportion of the population hospitalised for alcohol related causes was the second
lowest of any CHP. The proportion of the population hospitalised for drug related conditions
was also the second lowest of any CHP, with 47 patients discharged from hospital over the
last 3 years.57

For patients with heart disease, emergency admission patients, multiple admission patients
aged 65 years and over, and unintentional injuries among older people in the home, the
proportions of the population hospitalised are significantly lower than the Scottish average.

In the Angus CHP area, 10.6% of older people with intensive care needs are cared for at
home, rather than in care homes or geriatric long-stay hospital beds (the national average is
29.2%). Just under 4% of older people receive free personal care at home (with the national
rate being 4.8%). Angus is similar to the national average for all other mental health &
function indicators, with the exception of patients prescribed drugs for anxiety, depression or
psychosis where the CHP figure is 8.4%, compared to the Scottish rate of 8.1%.

In 2008 in Scotland, there were 13,817 abortions compared to 13,738 in 2007. In 2008, the
rate for women aged 15 to 44 was 13.1 for every 1,000 women compared to 11.1 in 2000.
The rate of terminations is highest in NHS Tayside at 15.7 per 1,000 women aged 15 to 44.58

The percentage of mothers smoking during pregnancy is significantly worse in Angus than
the national average (26.8%, compared to Scotland with 24.3%).

                                               Migration and Ethnicity

The table below shows that the projected increase in population in Angus and Scotland is
attributable to in-migration, as the natural change rate is negative.

                       Table 34: Components of Population Change, 1999/2009

                      Estimated                                      Estimated net     Estimated          Population
                                                          Natural                                          change
                      population      Births    Deaths            civilian migration & population
                                                          change
                       30.06.99                                     other changes59     30.06.09         Number    %
Scotland              5,071,950      547,885 567,042 -19,157               141,207           5,194,000   122,050 2.4
Aberdeenshire          227,240       24,819 21,302         3,517            12,753            243,510    16,270   7.2
Angus                  109,560       10,984 13,086         -2,102            2,792            110,250     690     0.6
Dundee City            147,970       15,674 17,641         -1,967           -2,613            143,390    -4,580   -3.1
Perth & Kinross        135,200       13,384 15,817         -2,433           13,143            145,910    10,710   7.9
Source: GROS (2010), Mid-2009 Population Estimates Scotland, Components of Population Change by
Administrative Area: 1999-2009



57 Scottish Public Health Observatory Team (2008), Health and Wellbeing Profile - Angus 2008
58 NHS Scotland Information Services Division (2009), Abortion Statistics, year ending December 2008
59 Includes changes in the number of prisoners and armed forces stationed in Scotland.



                                                                                                                       29
 The long term assumption for net migration to Scotland is 8,500 each year compared with
 4,000 in the 2004-based projections. This increase follows a recent rise in migration
 compared with previous years.

     Table 35: Long-term Annual Net Migration Assumptions in Scotland 2014 -15 Onwards

   Scotland                                                                                                                       2006-based                                              2004-based                                              Difference
   International net migration                                                                                                          +4,500                                                   +2,500                                                   +2,000
   Cross-border net migration                                                                                                           +4,000                                                   +1,500                                                   +2,500
   Total net migration                                                                                                                  +8,500                                                   +4,000                                                   +4,500
 Source: Government Actuary’s Department, Long-term annual net migration assumptions 2014-15 onwards

 In Angus, there has been an increase in net migration figures. This can be seen in below.

              Figure 9: Net Migration to/from Scottish Council Areas, 1981/82 to Most Recent60
 4,000



 3,000



 2,000



 1,000



     0



 -1,000



 -2,000


                                                       Aberdeenshire                                                     Angus                                        Dundee City                                                 Perth & Kinross
 -3,000
          1981-82
                    1982-83
                              1983-84
                                        1984-85
                                                  1985-86
                                                            1986-87
                                                                      1987-88
                                                                                1988-89
                                                                                          1989-90
                                                                                                    1990-91
                                                                                                              1991-92
                                                                                                                        1992-93
                                                                                                                                  1993-94
                                                                                                                                            1994-95
                                                                                                                                                      1995-96
                                                                                                                                                                1996-97
                                                                                                                                                                          1997-98
                                                                                                                                                                                    1998-99
                                                                                                                                                                                              1999-00
                                                                                                                                                                                                        2000-01
                                                                                                                                                                                                                  2001-02
                                                                                                                                                                                                                            2002-03
                                                                                                                                                                                                                                      2003-04
                                                                                                                                                                                                                                                2004-05
                                                                                                                                                                                                                                                          2005-06
                                                                                                                                                                                                                                                                    2006-07
                                                                                                                                                                                                                                                                              2007-08
                                                                                                                                                                                                                                                                                         2008-09




Source: GROS (2010), Total Migration To or From an Area




 60 Data from 1981-82 to 2000-01 also contains movements of prisoners and armed forces, so figures over that period differ
 from the estimates of civilian migration.



                                                                                                                                                                                                                                                                                        30
               Table 36: Tayside Recent Migration Summary, Mid 2006 – Mid 2007

                               Scotland              Angus          Dundee City          Perth & Kinross
                                Rate per             Rate per                 Rate per           Rate per
                         Total                 Total               Total                 Total
                                 1,000                1,000                    1,000              1,000
       Total             91,769    18          4,205    38         6,442         45      7,285      51
       Within Scotland    N/A        N/A       2,981      27       3,626         26      3,767      27
 In




       Rest of UK        53,968      10         863        8       1,298         9       1,810      13
       Overseas          37,800       7         361        3       1,518         11      1,708      12

       Total             64,957      13        3,557      32       6,508         46      5,101      36
       Within Scotland    N/A        N/A       2,569      23       4,202         30      3,273      23
 Out




       Rest of UK        43,957       9         695        6       1,568         11      1,167      8
       Overseas          21,000       4         293        3        738           5       661       5
       Total             26,811       5         648        6            -66      0       2,184      15
       Within Scotland     0          0         412        4        -576         -4       494       3
 Net




       Rest of UK        10,011       2         168        2        -270         -2       643       5
       Overseas          16,800       3         68         1        780          5       1,047      7
Source: GROS (2009), Tayside Area Migration Report (version 1.2), p.4

The figure and table show that net migration has increased, and there is a significant amount
of both in and out migration in Tayside compared to the Scottish average, although the
levels for Angus are not as high as for Dundee City or Perth and Kinross.

The number of National Insurance (NI) registrations in respect of non-UK Nationals since
2002/3 has increased dramatically in Angus, and this will have an effect on the numbers of
working age people in the county.

The impact of the 2004 accession to the EU of Hungary, Poland, the Czech Republic, the
Slovak Republic, Slovenia, Estonia, Latvia and Lithuania, Malta and Cyprus, is clear. These
migrants can legally seek and take up employment before being allocated a NI number
(NINo) but employers must ensure that a NINo is applied for as soon as possible. A NINo is
generally required by any overseas national looking to work or claim benefits or tax credits in
the UK, including the self employed and students working part time. However the self
employed do not need to register if they do not plan to claim.




                                                                                                         31
Figure 10: NINo Registrations to Adult Overseas Nationals entering the UK by World Area of
                   Origin as a percentage of the total (December 2008)
                 100

                           80

                           60
             %
                           40

                           20

                           0
                                   Scotland         Aberdeenshire           Angus    Dundee City   Perth and Kinross
    European Union                    16.4                5.9                2.4        12.7             5.3
    EU Accession States               40.6               77.5               91.3        44.6             87.3
    Other European                    2.3                 1.8                0.8         1.2             0.5
    Africa                            8.7                 2.4                0.8        10.8             1.3
    Asia and Middle East              22.4                5.9                3.2        25.9             3.8
    The Americas                      5.0                 4.1                0.8         2.4             0.8
    Australasia and Oceania           4.4                 1.8                0.8         1.2             1.3
Source: Department of Work and Pensions, NINo Registrations to Adult Overseas Nationals entering the UK
Time Series - Calendar Year Of Registration Date by LA by World Area of Origin

This graph shows that the majority of NINo registrations have been given to migrants from
the Accession states. This pattern is more marked in Angus that elsewhere, and is at more
than double the national average. At the same time, Angus has the most significant rate of
increase in migrant registrations since 2002/3 of the LAs compared.

More than half of migrants to Angus come from Poland. However, although the proportion of
Polish migrants is particularly high in Angus, this only represents 2.1% of Polish migrants to
Scotland. Almost 25% of Ukrainian migrants to Scotland were registered in Angus in
2007/8.61

                  Table 37: The Composition of Overseas Nationals entering Angus
                                  and allocated a NINo in 2007/8

Poland           51.2% Lithuania             3.5%     France          1.2% China 1.2% Pakistan           1.2%
Bulgaria         8.1% Latvia                 3.5%     Germany         1.2% RSA      1.2% Philippines 1.2%
Czech Rep 5.8% Ukraine                       3.5%     Hungary    1.2% USA           1.2% Moldova         1.2%
                                                      Russian
Slovak Rep 4.7% Romania                      2.3%                1.2% India         1.2% Australia       1.2%
                                                      Federation
Source: Angus Council (2008), Planning and Transport Division, Migration, p. 3

The figures above are seen as an underestimate as they do not include the self employed,
illegal migrants and those where employers do not ensure NINos are obtained. The figures
only provide a measure of in-migration for adult overseas nationals registering for a NINo,


61 Angus Council (2008), Planning and Transport Division, Migration, p. 3



                                                                                                                32
however do not reflect emigration (i.e. migrants who leave the UK) or the overall migrant
population (stock).

                       Figure 11: Migrant Registrations - % Increase since 2002/3
                   1,000
                    900
                    800
                    700
      % increase




                    600
                    500
                    400
                    300

                    200
                    100
                           2002/03         2003/04          2004/05   2005/06   2006/07   2007/08
        Angus                100             100             600       833        822      956
        Aberdeenshire        100             147             309       497        581      550
        Dundee City          100             135             175       292        359      341
        Perth & Kinross      100             164             321       485        573      718
        Scotland             100             136             263       416        482      474
Source: DWP (2009), 100% extract from the National Insurance Recording System (NIRS)

From the graph above it can be seen that there has been a decline in numbers of those
registering in Aberdeenshire, Dundee City and Scotland, although this pattern has not been
followed in Angus or Perth and Kinross.

At this time, it is not known whether the rate of in-migration is sustainable. The Office for
National Statistics (ONS) has reported that more foreign nationals left during the same 12
months than compared with the previous year. The number of Eastern Europeans leaving
the UK doubled in the year up to September 2008.

In the UK, over the year to last September, 720,000 NINos were issued to foreign nationals -
down 7% on the previous year. The ONS said the ‘key factor’ in the fall in NI registrations
was the decline in applications from the Accession states.62 It reported that 265,000 of the
NINos went to these nationals in the year to September - a fall of 71,000 on the previous
year. Over the same period, the government recorded 180,000 Eastern Europeans joining
the Worker Registration Scheme, down from 223,000 registrations between 2006 and 2008.

A study into the local migrant labour population undertaken by Scottish Economic Research
on behalf of Angus Council, Perth and Kinross Council, Communities Scotland and Scottish
Enterprise Tayside, revealed during the summer of 2005 there were up to 4,500 migrants
working in the former Tayside region area, with 22% of that number based in Angus. The
study also showed that many of the jobs undertaken by migrant workers were in rural areas,
and were primarily in elementary/low skilled occupations in the agricultural,
tourism/hospitality and food processing sectors. The reasons that employers gave for


62 BBC (20 May 2009), ‘More Eastern Europeans leaving UK’



                                                                                                    33
employing migrant workers were that there was an under-supply of workers (and of certain
skills) locally, and because they felt that migrant workers were more flexible and productive.

This is backed up by a Joint Report between the UK Border Agency, Department for Work
and Pensions, HM Revenue and Customs, and the Department for Communities and Local
Government, which monitored migrants from the Accession Countries. It found that 10% of
those working in hospitality and catering were working for employers in Scotland. It also
stated that 23% of those working for employers located in Scotland were working in
hospitality and catering. 21% were working in administration, business and management
(including employment agencies), whilst 17% were working in agriculture.63 The breakdown
can be seen below.

 Figure 12: Top 5 sectors - Geographical Distribution of employers of registered workers by
                             Sectors, May 2004 – March 2009

   130,000
                                                                                                                                               Retail
   120,000
   110,000
   100,000                                                                                                                                     Food/fish/meat
    90,000                                                                                                                                     processing
    80,000
    70,000                                                                                                                                     Manufacturing
    60,000
    50,000
                                                                                                                                               Agriculture
    40,000
    30,000
    20,000
                                                                                                                                               Hospitality & catering
    10,000
         0
                                                                               South West
                                                                  North West
                                           North East




                                                                                                       South East




                                                                                                                                       Wales
                                                        Central




                                                                                            Scotland




                                                                                                                    Northern Ireland
                       Midlands
              Anglia




                                  London




                                                                                                                                               Administration,
                                                                                                                                               business &
                                                                                                                                               management


Source: Joint Report between the UK Border Agency, DWP, HM Revenue and Customs, and the Department for
Communities & Local Government, Accession Monitoring Report A8 Countries, May 2004 – March 2009

In Angus, in 2005, the unemployment rate fell from 2.8% to 2.5% (a fall of 151 individuals),
while notified vacancies fell significantly at Arbroath, Forfar and Montrose Jobcentre Plus
offices. Therefore it would appear that the migrant workers coming to Tayside are filling a
gap in the supply of labour rather than displacing local workers. This view is supported in
previous research on the labour market impacts of migrant workers in the UK.64

The significance of this for the economy of Angus is clear. Migrants tend to be younger than
the general population with between 46% (rest of the UK) and 68% (overseas) of in-migrants
aged 16 to 34 compared with 24% of the resident population. Only 5% of people coming to
Scotland from the rest of the UK were aged 65 and over, as were an assumed 1% of
                   65
overseas migrants.

63 Joint Online Report Between the UK Border Agency, Department for Work and Pensions, HM Revenue and Customs and
Communities and Local Government, Accession Monitoring Report A8 Countries, May 2004 – March 2009
64 Scottish Economic Research (2006), The Tayside migrant labour population: scale, impacts and experiences, p.5
65 GROS (2008), Mid 2007 population estimate, p.4



                                                                                                                                                                        34
However, the potential positive effects of in-migration on the economy of Angus, are
somewhat offset by out-migration. More than half of out migration from Angus is attributable
to those aged between 16 and 34.66 Reasons for leaving Angus are commonly education or
employment related.

However, it is clear that some migrant workers at least are remaining in Scotland and Angus.
The following table provides a breakdown of births in Scotland, over a period of time, by the
country of the mother’s birth. It can be seen that the largest increase from a single country
comes from mothers born in Poland.

                        Table 38: Births, by Country of Mother’s Birth, Scotland

Mother's               1977                 1987                  1997                 2004             2007
country
of birth       Births         %      Births        %       Births        %      Births        %     Births     %

All births     62,342         --    66,241         --     59,440         --    53,957         --    57,781     --
Scotland 54,305 87.1% 57,064 86.1% 49,908 84.0% 43,813 81.2% 45,328 78.4%
England         4,683      7.5%      5,376      8.1%       5,676      9.5%      5,221      9.7%     5,328    9.2%
Poland            18       0.0%         8       0.0%         11       0.0%        31       0.1%      934     1.6%
Pakistan         324       0.5%       531       0.8%        480       0.8%       558       1.0%      641     1.1%
Northern
                 416       0.7%       365       0.6%        394       0.7%       493       0.9%      536     0.9%
Ireland
Germany          121       0.2%       240       0.4%        369       0.6%       385       0.7%      397     0.7%
India            213       0.3%       168       0.3%        112       0.2%       201       0.4%      324     0.6%
Ireland          464       0.7%       247       0.4%        214       0.4%       230       0.4%      303     0.5%
Other           1,798      2.9%      2,242      3.4%       2,276      3.8%      3,025      5.6%     3,990    6.9%
Source: GROS (2008), Scotland's Population 2007

In Scotland since 2004, the number of births has increased by 3,824. Scots-born mothers
accounted for 1,515 (or 40% of that increase), and other UK-born mothers for a further 184
(or 5% of the increase). Polish-born mothers contributed 903 extra births (or 24% of the
increase) and mothers born in the other nine accession countries which joined the EU in
2004 a further 233 extra births (or 6% of the increase). There were an extra 156 babies (4%
of the total increase) born to mothers from the remaining EU countries and 833 (22% of the
total increase) to mothers from the rest of the world.

Angus in 2001 had a 0.8% ethnic minority population, which was significantly lower than the
Scotland average (2.0%). Given the above, it is probable that the next Census, due in 2011,
will show an increase in the number of the resident population born outwith Scotland. The
table below demonstrates the levels recorded by the 2001 Census.




66 East of Scotland Labour Market Information (2005), Angus Migration and Commuting Patterns, p.3



                                                                                                                    35
                         Table 39: Country of Birth, Angus and Scotland, 2001

 Country of Birth                                                               Angus                 Scotland
 Total resident population                                                     108,400               5,062,011
 - % Scotland (inc UK part not specified)                                       88.33                   87.15
 - % England                                                                     8.18                    8.08
 - % Wales                                                                       0.32                    0.33
 - % Northern Ireland                                                            0.45                    0.66
 - % Ireland (inc. part not specified)                                           0.23                    0.43
 - % Rest of Europe                                                              0.82                    1.10
 - % Elsewhere                                                                   1.67                    2.25
 % of households where not all persons are in the
                                                                                 0.59                    0.97
  same ethnic category
 % of households where not all persons are in the
                                                                                13.75                   13.49
  same country of birth category
Source: Scotland’s Census Results Online.

There are plans to expand the number of ethnic group categories to be included in the 2011
Census. If approved by the Scottish Parliament the number of categories included will rise
from 14 to 21. New options have been added for those who describe themselves as white,
allowing them to state if they are English, Welsh, Northern Irish, Polish, or a gypsy/traveller.
A question on national identity is also being developed, so people could say if they feel they
are ‘Scottish’, ‘British’ or have another national identity.

Research conducted by Communities Scotland in 2004 reveals that the black and minority
ethnic (BME) group accounted for only 0.8% of the Angus in 2001, but indicated that the
population had grown rapidly from 574 to 854 between 1991 and 2001. In Angus, BME
groups are focused on Monifieth and Forfar, with small clusters of Pakistani residents in
Brechin and Chinese in Keptie. It also revealed that members of all BME groups are overall
considerably younger than their white counterparts. The proportion and number of all BME
groups aged over 70 years in Angus, and Scotland is set to rise in the long term, although
from low bases.67

                                                Benefit recipients.

Working-age benefits are social security benefits which are available to people of working
age who are out of work or have a low income. They are administered by the Department for
Work and Pensions (DWP).

In Scotland, there was little change in overall levels of poverty and income inequality
between 2007/08 and 2008/09. However, there were some changes in the proportions of
different age groups that were living in poverty. The percentage of people in relative poverty
(before housing costs) remained at 17% between 2007/08 and 2008/09. Over this period
slight increases were recorded in two of the three indicators used to measure child poverty.
The third recorded a slight decrease. The proportion of working age adults in relative poverty
increased from 15% to 16%, an increase of 30,000 individuals. There was also a 5% fall in
the proportion of pensioners living in relative poverty, a reduction of 50,000 individuals.68


67 Communities Scotland (2004), Precis No 43, ‘The Housing Needs and Aspirations of Black and Minority Ethnic Communities
in Angus and Dundee.’
68 Scottish Government (2010), Local Authority Level Proxy Poverty Data



                                                                                                                      36
Key working-age benefits are Jobseeker's Allowance (JSA), Incapacity Benefit (IB) and
Severe Disablement Allowance (SDA), Income Support (IS), and Disability Living Allowance
(DLA). From 27 October 2008, Employment and Support Allowance (ESA) replaced IB and
IS paid on incapacity grounds for new customers. The principle of ESA is that everyone
should have the opportunity to work and that people with an illness or disability should get
the support they need to engage in appropriate work, if they are able.

People who are not entitled to receive benefit payments may be awarded NI Credits instead
in order to maintain their eligibility for a state pension. NI Credits are awarded through both
the JSA and IB systems. Data on working-age benefits include cases where the claimant
receives NI Credits only.

In August 2008 14.2% UK population of working age received income from one of the main
social security benefits in the UK available to people who are unemployed, disabled, or who
have sufficiently low income (this is an increase of 0.2% from 2003). Changes in the number
of people receiving benefits depend on demographic and other non-economic trends, on the
benefit system, and on the state of the macroeconomy. The figure for Angus was 13.7%.69

The number of people claiming out of work benefits (unemployment benefits, IB and IS) in
Scotland was approximately 489,550 in November 2009. This is an increase of 47,940 since
November 2007.

                   Table 40: Claimants of out of work benefits by LA, 2007/2009

                             November 2007                  November 2008                  November 2009
                          Number        %                Number        %                Number        %
Aberdeenshire              10,460      7.1                10,530      7.1                11,300      7.6
Angus                       7,160      11.0                7,440      11.5                7,980      12.3
Dundee City                16,400      18.4               16,800      18.9               17,750      19.9
Perth & Kinross             7,480      8.8                 7,810      9.1                 8,290      9.6
Scotland                  441,610      13.7              457,240      14.1              489,550      15.1
Source: DWP benefit claimants - working age client group
% is a proportion of resident working age population of area. Claimants of unemployment related benefits, IB or
IS, excluding those on SDA only and male claimants aged 60-64 on Pension Credit without also IB.

The number of people claiming working age benefits in Scotland was 572,400 in November
2009. This is an increase of 52,900 since November 2007. There has also been an
increase in the number of claimants in Angus. The ranks represent the position of the LA in
comparison to all Scottish LAs in November 2009, with rank 1 having the highest level of
claimants, and rank 32 having the lowest.

                                      Table 41: Working age benefits

  Rank                                        Nov-07                    Nov-08                    Nov-09
            LA
(Out of 32)                                No       %               No            %           No            %
            Scotland                    519,500    16.1          536,830         16.6      572,400         17.7
     5      Dundee City                  18,520    20.8           18,990         21.3       20,060         22.5
    19      Angus                         8,700    13.4            8,990         13.9        9,580         14.8
    29      Perth & Kinross               9,320      11            9,660         11.2       10,200         11.8
    32      Aberdeenshire                13,330     9.0           13,480         9.0        14,350         9.6
Source: DWP, Work and Pensions Longitudinal Study, & Nomis, Claimant Count Unemployment


69 DWP, In-House Report 124 - Evaluating Labour Market Policies Aimed At Reducing The Number Of Benefit Recipients &
DWP Information Directorate, Work and Pensions Longitudinal Study.



                                                                                                                  37
The DWP allocates claimants of key working-age benefits into statistical client groups,
unemployed, sick/disabled, lone parent or other, based mainly on the benefit they receive.
The following tables demonstrate the situation in Angus, its neighbouring LAs, and also the
number of people within Angus and Scotland who are claiming IS and IB.

                  Table 42: Working Age Claimants of Key Benefits, November 2009

                                                                                           Other
                                            Incapacity
                Total       Job Seeker                    Lone Parent        Carer        income       Disabled     Bereaved
                                             benefits
                                                                                          related
             No         %     No      %     No       %      No       %      No       %    No     %     No      %     No    %
Aberdee
        14,350 9.6          2,100 1.4      7,890    5.3    1,010    0.7    1,210 0.8      310   0.2 1,370 0.9       460 0.3
nshire
Angus   9,580 14.8          2,060 3.2      4,710    7.3     900     1.4    720     1.1    300   0.5    700    1.1   190 0.3
Dundee
           20,060 22.5      4,750 5.3 10,360 11.6 2,060             2.3    1,130 1.3      580   0.7    980    1.1   190 0.2
City
Perth &
           10,200 11.8      1,910 2.2      5,250    6.1     830     1.0    780     0.9    290   0.3    900    1.0   230 0.3
Kinross
Scotland 572,400 17.7 129,800 4.0 287,410 8.9 55,660 1.7 37,830 1.2 16,680 0.5 36,360 1.1 8,670 0.3
Source: Nomis (2010), DWP Benefit Claimants - Working Age Client Group.
% based on the population aged 16-59/64.

                                   Table 43: Benefit Claimants (Working Age)

                                                     Angus                                       Scotland
                                            Nov 2008      Nov 2009                       Nov 2008       Nov 2009
 Number of claimants                         (000s)        (000s)                         (000s)          (000s)
 Income Support                                     3.1           2.9                         209.8           188.7
 Incapacity Benefit/ESA                             4.1           4.3                         261.9           265.4

 % Change                                             2008-2009                                  2008-2009
 Income Support                                         -8.6%                                     -10.1%
 Incapacity Benefit/ESA                                  4.9%                                      1.4%
Source: Scottish Government Analytical Service Division (2010), Angus Economic Briefing.
ESA was introduced in Oct 2008 and affects some claimants previously claiming IB.

This shows that there has been a decline in the number of recipients of IS in Angus and
Scotland, although the rate of decline in Angus has been slower. There has been an
increase in the number of people claiming ESA for both areas. It is important to note that
changes in the benefit rates are not necessarily indicative of changes in the wider economy
and may be related to changes in the welfare system itself.

There is a difference between unemployment, as officially measured by the Labour Force
Survey using the internationally agreed International Labour Organisation (ILO) definition,
and the claimant count based on the number of people claiming JSA.

Unemployment (officially measured using the ILO definition70) is much higher than the
number of people in the claimant count, that is those claiming JSA. This difference is
especially prevalent among women.



70 The ILO definition of unemployment covers people who are: out of work, want a job, have actively sought work in the
previous four weeks and are available to start work within the next fortnight; or out of work and have accepted a job that they
are waiting to start in the next fortnight.



                                                                                                                            38
The two measures move differently over time, though usually in the same direction.
However, when employment is high the gap between unemployment and the claimant count
tends to widen, as some jobless people who were not previously looking for work start to do
so. By actively looking for work they may become classified as unemployed under the ILO
definition. However they do not feature in the claimant count unless they begin to claim
benefits.71 In contrast the gap tends to narrow during periods of increasing unemployment.72

Another major factor affecting the gap is changes in the number of people becoming
unemployed who are not eligible for JSA, for example, because of their partner’s earnings.

The difference between the two rates can be seen in the following graph.

             Figure 13: Claimant Count and ILO Unemployment – Angus & Scotland
 6.0%
           5.8%
                                       5.4%                 5.3%
                  5.7%                                                            5.2%                      5.3%
 5.0%
                                                            4.9%                  5.0%                      4.7%
                                       4.6%
 4.0%
           3.7%                        3.5%
                                                            3.2%                  3.3%
            3.1%
 3.0%
                                      3.0%                                                                  2.8%
                                                            2.8%                  2.8%
                                                                                                            2.3%
 2.0%
                   Claimant Count Unemployment - Scotland               Claimant Count Unemployment - Angus
                   ILO unemployment - Scotland                          ILO unemployment - Angus
 1.0%
               2003                   2004                  2005                  2006                  2007
Source: Scottish Government Analytical Service Division (2009), Angus Economic Briefing/Annual Labour Force
Survey.

JSA is payable to people under pensionable age who are available for, and actively seeking,
work of at least 40 hours a week. The tables below illustrate the position of Angus,
compared to Scotland and Great Britain.
                                                                                     73
                              Table 44: Total JSA claimants (June 2010)

                         Angus (numbers)            Angus (%)            Scotland (%)         Great Britain (%)
  All people                   2,056                     3.2                   4.1                    3.8
  Males                        1,481                     4.4                   5.8                    5.1
  Females                       575                      1.9                   2.3                    2.2
Source: Nomis (2010), Claimant Count with Rates & Proportions.




71 ONS, (2002), Measuring the Jobless: What are unemployment and claimant count?
72 A. Machin (2004), ONS, Labour Market Trends: Comparisons Between Unemployment and the Claimant Count, p.59
73 For tables 44, 45, & 46, the % is a proportion of resident working age people.




                                                                                                                   39
        Table 45: Number and Proportion of JSA claimants from April 2006 – April 2010

      Date            Angus (numbers)            Angus (%)          Scotland (%)        Great Britain (%)
    Apr 2006                 1,868                   2.9                  2.9                    2.6
    Apr 2007                 1,586                   2.4                  2.6                    2.4
    Apr 2008                 1,259                   1.9                  2.3                    2.2
    Apr 2009                 2,141                   3.3                  3.9                    4.1
    Apr 2010                 2,184                   3.4                  4.3                    4.1
Source: Nomis (2010), Claimant Count with Rates & Proportions.

             Table 46: JSA Claimants by Age and Duration (June 2006 and 2010)

                                Angus               Angus              Scotland             Scotland
                             June 2006            June 2010           June 2006            June 2010
                            Level               Level                Level                Level
                                    Rate                Rate                 Rate                 Rate
                           (000s)              (000s)               (000s)               (000s)
All People                   1.8    3.2%         2.1    3.2%         90.1    3.3%        133.5    4.8%
Males                        1.3      4.5%       1.5       4.3%      67.6       4.9%      97.4         6.7%
Females                      0.5      1.9%       0.6       1.9%      22.5       1.7%      36.1         2.7%
                            Level               Level                Level                Level
                                      Rate                 Rate                 Rate                   Rate
                           (000s)              (000s)               (000s)               (000s)
Age: 18-24                  0.53     29.9%      0.60       29.2%     25.6       29.4%     37.8         28.8%
Age: 25-49                  0.88     50.1%       1.09      53.6%     46.3       53.3%     73.3         55.8%
Age: 50+                    0.35     19.9%       0.35      17.2%     15.0       17.3%     20.2         15.4%
Duration: 6 Months +        0.66     36.0%       0.66      32.1%     31.2       34.6%     49.8         37.3%
Duration: 1 year +          0.32     17.3%       0.24      11.4%     13.5       14.9%     21.1         15.8%
Source: Scottish Government Analytical Service Division (2006 & 2010), Angus Economic Briefing

Levels of unemployment in Angus are below the Scottish average, although there is high
unemployment in those aged between 18 and 24, and among the over 50s.

Rising unemployment has an impact on the number of children who are living in workless
households, and are dependent on out of work benefits. The percentage of children living
in low income households increased in all but 9 of the 32 LA areas in Scotland, with only 1
LA showing a reduction (Stirling). Angus was one of the 9 LAs whose rate remained static
between 2005/6 and 2007/8, along with East Ayrshire, East Lothian, Highland, South
Lanarkshire, Falkirk, Aberdeen and Aberdeenshire. Given the impact of the recession on
unemployment, in is expected that the next release of these figures will reflect a further
worsening of the situation.

The table below illustrates the number and proportion of children living in households that
are dependent on out of work benefits or Child Tax Credit (more than the family element). It
can be seen that between 2005/6 and 2007/8, there was an increase of 1% nationally,
however the proportion in Angus remained the same, although the actual number of children
reduced by 50.




                                                                                                              40
 Table 47: Number and Proportion of Children Living in Households that are Dependent on
         Out Of Work Benefits or Child Tax Credit (more than the family element)

                 No of children living in
                  households that are         Mid year estimate of population    Percentage of children living
LA
                dependent on out of work        aged 0-19 years inclusive         in low income households
               benefits or Child Tax Credit
             2005/06     2006/07 2007/08       2005        2006        2007      2005/06 2006/07 2007/08
Aberdeen
              17,350     18,100     17,520    57,917      58,131      58,228       30%       31%       30%
shire
Angus         11,060     11,310     11,010    25,132      25,147      25,089       44%       45%       44%
Dundee
              17,330     17,250     17,320    32,730      32,142      31,780       53%       54%       54%
City
Perth &
              12,180     12,560     12,430    31,667      31,640      31,722       38%       40%       39%
Kinross
Scotland     528,240     534,910 531,420 1,192,364 1,184,789 1,180,907             44%       45%       45%
Source: Scottish Government (2010), Local Authority Level Proxy Poverty Data

 Figure 14: Proportion of Children Living in Households that are Dependent on Out Of Work
                Benefits or Child Tax Credit (more than the family element)
 70%


 60%

                                                        2005/06    2006/07      2007/08
 50%


 40%


 30%


 20%


 10%


  0%
                                 Fife




                             Moray
                             Falkirk
                      Glasgow City


                     North Ayrshire

                      East Ayrshire




                      Argyll & Bute
                         Inverclyde

              Dumfries & Galloway




                             Angus
                  Scottish Borders




                   Perth & Kinross




                             Stirling
                       Dundee City




                      Renfrewshire

                     South Ayrshire


                    Orkney Islands




                     Aberdeen City




                East Renfrewshire
                           Highland


                         Midlothian

                      West Lothian




                  Shetland Islands
             West Dunbartonshire




                 North Lanarkshire
                Clackmannanshire




                       East Lothian
                South Lanarkshire




                     Aberdeenshire
              East Dunbartonshire

                       SCOTLAND
                 Edinburgh, City of
        Eilean Siar (Western Isles)




Source: Scottish Government (2010), Local Authority Level Proxy Poverty Data

People over the state pension age may also be entitled to a variety of benefits. The
pensioner client group covers claimants over State Pension age (currently 60 for females


                                                                                                             41
and 65 for males), to at least one of the following benefits: State Pension, Pension Credit,
Attendance Allowance (AA), Widow’s Benefit, DLA, IB, and SDA.

In November 2008, in the UK, there were 12.4 million claimants in the client group, an
increase of 214,000 since November 2007. Of these, 20% were in receipt of pension credit.
Almost half (49%) of these claimants were also claiming AA or DLA. Those claiming only
the state pension equated to 66%. There were 12.2 million claimants of state pension, a
rise of 220,000 on a year earlier. Of these, 38% were male and 62% female. There were
2.73 million claimants of pension credit (3.34 million including partners), a fall of 3,000 on a
year earlier. Of these, 901,000 claimed guarantee credit only, 1.23 million claimed guarantee
and savings credit, and 598,000 were claiming savings credit only. 74

As the number of people in this age group increases, the burden on the state will become
more onerous. The table below shows the most recent figures for Angus and its
neighbouring LAs.

         Table 48: Population over State Pension Age Claiming Key Benefits, May 2004

                                                    Sick and            Non Disabled Minimum    Retirement
                                Total
                                                    Disabled              Income Guarantee     Pension only
                         (000s)       %*        (000s)         %          (000s)        %      (000s)   %
Scotland                 945.4        100        283.2        30          106.2         11     556.1    59
Aberdeenshire             41.3        100          8.7        22           4.1          11      28.5    73
Angus                     22.4         98          5.2        23           2.5          11      14.7    64
Dundee City               29.1         98         10.0        34           3.5          12      15.6    52
Perth & Kinross           29.9        100          6.0        20           2.8          9       21.0    71
Source: DWP, Information Directorate. * Percentage of population aged 60/65 years and over.

                                                       Deprivation

The Scottish Index of Multiple Deprivation (SIMD) identifies small area concentrations of
multiple deprivation across Scotland. It aids effective targeting of policies and funding where
the aim is to tackle or take account of area concentrations of multiple deprivations. The
SIMD is presented at data zone level, enabling small pockets of deprivation to be identified.
The data zones, which have a median population of 767 (in SIMD 2009), are ranked from
most deprived (1) to least deprived (6,505) on the overall SIMD and on each of the individual
domains. The result is a comprehensive picture of area deprivation across Scotland.75

The SIMD 2009 combines 38 indicators across 7 domains, namely:

    income                         employment                        health         crime
    education                      skills & training                 housing        geographic access

The overall index is a weighted sum of the 7 domain scores. The weighting for each domain
is based on its relative importance in measuring multiple deprivations, the robustness of the
data and the time lag between data collection and the production of the SIMD.




74 DWP (2009), Quarterly Statistical Summary
75 Scottish Government (2009), Scottish Index of Multiple Deprivation



                                                                                                             42
Prior to weighting, the domains are standardised by ranking the scores. The ranks then
undergo a statistical transformation to avoid high ranks in one domain 'cancelling out' low
ranks in another. The domain weightings used in SIMD 2009, expressed as a percentage of
the overall weight are: current income (28%), employment (28%), health (14%), education
(14%), geographic access (9%), crime (5%) and housing (2%). The results reveal the
following:

                                      National Share

    Angus has no datazones in the 5% most deprived on SIMD 2009. This has not
     changed since SIMD 2004.
    In SIMD 2009, 6 of the datazones in the 15% most deprived datazones in Scotland
     were in Angus, compared to 8 in 2006 and 3 in 2004.
    6 of the 9 datazones in Angus that were in the 20% most deprived datazones in
     Scotland in the SIMD 2006 remain there in SIMD 2009. 3 datazones in Arbroath
     Harbour and Brechin East have moved out but 2 datazones (in Arbroath Harbour and
     Arbroath Cliffburn) have moved in.

                                       Local Share

    In SIMD 2009, 6 of the 142 datazones in Angus were in the 15% most deprived
     datazones in Scotland, compared to 8 in 2006 and 3 in 2004.
    All except 1 of the 7 datazones in the 5% most locally deprived within Angus in SIMD
     2009 have remained the same since SIMD 2006. Arbroath Harbour moved out of the
     group, and Arbroath Cliffburn moved in.

                                         Overall

    The most deprived datazone on the overall SIMD 2009 in Angus is S01000626 with a
     rank of 337. It is in the Intermediate Zone of Arbroath Warddykes.
    S01000626 is the most deprived in 3 of the domains: income; employment; and
     education.
    In Angus, the 20% most deprived datazones are in Arbroath, with 1 in Brechin.
    Datazones in the 40% most deprived in Scotland can be found in densely populated
     areas, most noticeably: Arbroath, Brechin, Forfar, Kirriemuir and Montrose.

                                         Income

    On the income domain, 8 of the datazones in the 15% most deprived datazones in
     Scotland were in Angus, compared to 9 in 2006 and 11 in 2004.
    8 datazones in Angus were in the 15% most deprived datazones in Scotland,
     compared to 9 in 2006 and 11 in 2004.
    The most deprived datazone on the SIMD 2009 income domain in Angus is
     S01000626 with a rank of 89.
    The largest concentration of income-deprived datazones can be seen in Arbroath.
     Smaller concentrations can be seen in Brechin, Forfar, Kirriemuir and Montrose.

                                       Employment

    On the employment domain, 7 of the datazones in the 15% most deprived datazones
     in Scotland were in Angus, compared to 7 in 2006 and 4 in 2004.
    7 datazones in Angus were in the 15% most deprived datazones in Scotland,
     compared to 7 in 2006 and 4 in 2004.
    The most deprived datazone on the SIMD 2009 employment domain in Angus is
     S01000626 with a rank of 569.


                                                                                         43
      The biggest concentration of employment-deprived datazones are in Arbroath, with
       smaller concentrations in Brechin and Montrose.

                                                       Health

      On the health domain, 1 of the datazones in the 15% most deprived datazones in
       Scotland were in Angus, compared to 2 in 2006 and 0 in 2004.
      1 datazone in Angus was in the 15% most deprived datazones in Scotland, compared
       to 2 in 2006 and 0 in 2004.
      The most deprived datazone on the SIMD 2009 health domain in Angus is S01000606
       with a rank of 947. It is in the intermediate zone of Arbroath Harbour.

                                                     Education

      On the education domain, 4 of the datazones in the 15% most deprived datazones in
       Scotland were in Angus, compared to 8 in 2006 and 3 in 2004.
      4 datazones in Angus were in the 15% most deprived datazones in Scotland,
       compared to 8 in 2006 and 3 in 2004.
      The most deprived datazone on the SIMD 2009 education domain in Angus is
       S01000626 with a rank of 391.

                                                      Housing

      Angus has no datazones in the 15% most deprived on the housing domain.
      The most deprived datazone on the SIMD 2009 housing domain in Angus is
       S01000632 with a rank of 1,384. It is in the intermediate zone of Letham and Glamis.

                                                       Access

      On the access domain, 37 of the 976 datazones in the 15% most deprived datazones
       in Scotland were in Angus compared to 37 in 2006 and 34 in 2004.
      37 datazones in Angus were in the 15% most deprived datazones in Scotland,
       compared to 37 in 2006 and 34 in 2004.
      The most deprived datazone on the SIMD 2009 access domain in Angus is S01000710
       with a rank of 32. It is in the intermediate zone of the Angus Glens.
      The most deprived datazone on the SIMD 2009 public transport sub-domain in Angus
       is S01000710 with a rank of 33.
      The most deprived datazone on the SIMD 2009 drive time sub-domain in Angus is
       S01000710 with a rank of 49.

                                                       Crime

      On the crime domain in SIMD 2009, 18 of the 976 datazones in the 15% most deprived
       datazones in Scotland were in Angus, compared to 11 in 2006.
      18 datazones in Angus were in the 15% most deprived datazones in Scotland,
       compared to 11 in 2006.
      The most deprived datazone on the SIMD 2009 crime domain in Angus is S01000682
       with a rank of 128. It is in the intermediate zone of Montrose South.76

The tables below illustrates the number of datazones in Angus and its neighbouring LAs that
are in the respective groupings, and reflect the changes over time between the publication of
the first SIMD in 2004, and the 2009 revision.


76 Scottish Government (2009), SIMD 2009 - Local Authority Text Summaries - Angus



                                                                                           44
                      Table 49: National Share of Deprived Datazones by LA

                       5% Most deprived data zones                        15% Most deprived data zones
                 SIMD 2004                    SIMD 2009                    SIMD 2004                SIMD 2009
              No. of National              No. of National              No. of National          No. of National
               data    share                data    share                data    share            data    share
              zones     (%)                zones     (%)                zones     (%)            zones     (%)
Aberdeenshire   0       0.0                  0       0.0                  2       0.2              4       0.4
Angus                 0         0.0           0            0.0            3           0.3          6          0.6
Dundee City           9         2.8           19           5.8           51           5.2         55          5.6
Perth & Kinross       0         0.0           2            0.6            3           0.3          7          0.7
Scotland            325        100.0          325         100.0          976         100.0        976        100.0
Note: The national share is the number of data zones in the LA area in the vigintile as a proportion of the total
number of data zones in the vigintile.
Source: Scottish Government (2009), Scottish Index of Multiple Deprivation: 2009 General Report

                          Table 50: Local Share of Deprived Datazones by LA

                              5% Most deprived data zones                     15% Most deprived data zones
              No. of   SIMD 2004                      SIMD 2009                 SIMD 2004           SIMD 2009
               data No. of Local                    No. of Local              No. of Local        No. of Local
              zones data     share                   data   share              data   share        data   share
                     zones    (%)                   zones    (%)              zones    (%)        zones    (%)
Aberdeenshire  301     0       0                      0       0                 2      0.7          4      1.3
Angus               142        0          0           0           0             3       2.1            6         4.2
Dundee City         179        9          5          19          10.6          51       28.5           55     30.7
Perth & Kinross     175        0          0           2           1.1           3       1.7            7          4
Scotland          6,505       325         5         325           5            976          15     976           15
Note: The local share is the number of data zones in the LA area in the vigintile as a proportion of the total
number of data zones in the LA area.
Source: Scottish Government (2009), Scottish Index of Multiple Deprivation: 2009 General Report

     Table 51: Levels of Income and Employment Deprivation in the 15% Most Deprived
                                     Datazones by LA

                                                 % of income        No of
                    No of income      No of                                                 % of employment
                                                deprived living employment      No of
                   deprived in 15%   income                                                 deprived living in
                                                 in 15% most deprived in 15% employment
                   most deprived on deprived in                                            15% most deprived
                                                deprived data most deprived deprived in LA
                     SIMD 2009          LA                                                    data zones
                                                     zones      on SIMD 2009
Aberdeenshire          1,120          21,735          5%                 590            9,570               6%

Angus                  1,960          15,660          13%                645            6,430               10%

Dundee City           17,830          32,795          54%               7,065          14,555               49%

Perth & Kinross        1,855          16,105          12%                560            6,800               8%

Scotland              312,865         879,190         36%             126,495         390,665               32%
Source: Scottish Government (2009), Scottish Index of Multiple Deprivation: 2009 General Report



                                                                                                                       45
   Table 52: Percentage of the Population Living in the Most Deprived Datazones who are
                             Income and Employment Deprived
                                                                                                               % of
                       Population
                                   Number       % of population         Working age                No      population in
                         in 15%
                                    income       in 15% most    Working population in          employment 15% most
                          most
            Population            deprived in      deprived      Age     15% most              deprived in   deprived
                        deprived
             (2007)               15% most      datazones who population deprived               15% most    datazones
                       datazones
                                   deprived       are income    (2007) datazones in              deprived    who are
                        in SIMD
                                  datazones        deprived              SIMD 2009              datazones employment
                          2009
                                                                                                             deprived
Aberdeen
         239,160         3,285        1,120         34%           155,507        2,212            590          27%
shire
Angus        109,870     4,530        1,960         43%           68,864         2,821            645          23%

Dundee
             142,150    41,454       17,830         43%           92,895         26,063          7,065         27%
City
Perth &
             142,140     4,335        1,855         43%           89,675         2,629            560          21%
Kinross
Scotland 5,144,201 743,218           312,865        42%          3,381,637 478,420              126,495        26%
Source: Scottish Government (2009), Scottish Index of Multiple Deprivation: 2009 General Report

Of the datazones in the 15% most deprived, 92% are in urban areas, 2% are in rural areas,
and 0.6% are in remote rural areas. This is because in rural areas populations tend to be
more mixed so concentrations of population with similar characteristics are less likely to
occur. This is reflected in the table below.

           Table 53: Datazones in the 15% Most Deprived by Urban Rural Classification

                                  5% Most deprived data zones                   15% Most deprived data zones
                              SIMD 2004             SIMD 2009             SIMD 2004                     SIMD 2009
                           No. of National       No. of National       No. of National               No. of National
                            data     share        data     share        data     share                data     share
                           zones      (%)        zones      (%)        zones      (%)                zones      (%)
Large Urban Areas           285         87.7      239       73.5           674         69.1           598       61.3

Other Urban Areas            35         10.8       78       24.0           228         23.4           296       30.3

Accessible Small Towns       1           0.3       4            1.2         34           3.5            41       4.2

Remote Small Towns           0           0.0       1            0.3         15           1.5            22       2.3

Accessible Rural             4           1.2       1            0.3         23           2.4            13       1.3

Remote Rural                 0           0.0       2            0.6         2            0.2            6        0.6

Scotland                    325         100       325        100           976        100.0           976       100.0
Source: Scottish Government (2009), Scottish Index of Multiple Deprivation: 2009 General Report




                                                                                                                        46
  Chapter Three                             The Economy
                                                           Local Economic Indicators

A range of indicators can be used to measure the performance of an economy. These
include Gross Domestic Product (GDP) - a measure of the value added to materials and
other inputs in the production of goods and services, before allowing for depreciation or
capital consumption. Net receipts from interest, profits and dividends abroad are excluded.

Gross Value Added (GVA) is a measure of the contribution to GDP made by an individual
producer, industry or sector. It is the difference between the value of goods and services
produced (output) and the cost of raw materials and other inputs that are used in production,
that is, the value added by any unit engaged in production.77

Other measures include Gross Disposable Household Income (GDHI) and Business
Formation/Survival Rates. GVA and GDHI measure different aspects of a region’s income.
GVA gives an indication of the value of the economic activity generated within an area, while
GDHI provides an indication of the income received by resident households.

Economies are not static entities and are prone to cyclical changes. Outputs in the economy
change over time, according to changes in the wider global economy and prevailing
economic climate. Cyclical changes occur when the rates of growth of production, incomes
and spending fluctuate. Periodic changes in output are tracked to measure the cyclical
movement of the economy. The figure below shows this cycle for Scotland and the UK.

               Figure 15: Scotland and UK Annual GDP Growth Rates, 2000 Q3 to 2009 Q1
 5%


 4%


 3%


 2%


 1%


 0%


-1%
                                                                                 Scotland                      UK
-2%
      2000Q3

                 2001Q1

                          2001Q3

                                   2002Q1

                                             2002Q3

                                                      2003Q1

                                                               2003Q3

                                                                        2004Q1

                                                                                    2004Q3

                                                                                             2005Q1

                                                                                                      2005Q3

                                                                                                               2006Q1

                                                                                                                        2006Q3

                                                                                                                                 2007Q1

                                                                                                                                          2007Q3

                                                                                                                                                   2008Q1

                                                                                                                                                            2008Q3

                                                                                                                                                                      2009Q1




Source: Scottish Government (2009), Gross Domestic Product for Scotland

When GDP is rising the economy is said to be experiencing economic growth. When output
falls or when the growth of output is below the long term trend rate, the economy is said to
be contracting.



77 ONS (2009), Economic and Labour Market Review, Volume 3, No. 5, ‘Regional Gross Value Added’, p. 43



                                                                                                                                                                 47
A period of contraction, if prolonged, can be termed a recession. There is no official
definition of recession, but there is general recognition that the term refers to a period of
decline in economic activity. Most analysts use, as a practical definition, 2 consecutive
quarters of decline in a country's GDP. Although this definition is useful, it has drawbacks. A
focus on GDP alone is narrow, and it is often better to consider a wider set of measures of
economic activity to determine whether an economy is in recession.78

A wider definition of a recession is, ‘a significant decline in economic activity spread across
the economy, lasting more than a few months, normally visible in production, employment,
real income, and other indicators.’79 This definition focuses on a comprehensive set of
measures, including not only GDP, but also employment, income, sales, and industrial
production, to analyse the trends in economic activity.

Despite this, 2 consecutive quarters of decline in real GDP is commonly taken to be a
recession. The changes in GDP rates in Scotland between 2004 and 2009 can be seen
below. There were been 5 quarters of negative GDP, which illustrate the period when the
Scottish economy was in recession. The return to growth in Q4 2009 ended this.

                          Figure 16: GDP Rates for Scotland, 2004 – 2010
2


1


0


-1


-2
                                                    Quarter on quarter
-3
     Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

         2004              2005              2006             2007              2008              2009       2010
Source: Scottish Government (2010), Gross Domestic Product for Scotland, Quarter 1 2010

In Scotland, GDP fell by 4.8% annually, but grew by 0.2% in Q4 2009, after a fall of 0.2% in
Q3 2009. GDP remained the same for Q1 2010. The UK figures show that GDP on a
comparable basis fell by 3.3% in the year to end-March 2010 and grew by 0.3% in Q1 2010.

In the year to end March 2010, the Scottish service sector fell by 2.4%, the production sector
fell by 7.1%, and the construction sector fell by 8.3%. Over the year, the UK experienced a
2.4% fall in services, a 7.2% fall in production and a fall of 8.0% in the construction sector.

In the year to end December 2009, the Scottish service sector fell by 3.6%, the production
sector fell by 8.9%, and the construction sector fell by 10.8%. Over the year, the UK
experienced a 3.5% fall in services, a 10.2% fall in production, and a fall of 10.8% in the
construction.



78 International Monetary Fund (2009), ‘What is a Recession?’, Finance and Development Magazine
79 The American National Bureau of Economic Research, ‘Business Cycle Expansions and Contractions’. Available from
www.nber.org/cycles.html.



                                                                                                               48
In the Q1 2010, the service sector fell by 0.2%, the production sector remained unchanged
and the construction sector grew by 2.8%. In Q1 2010, the UK service sector grew by 0.3%,
the production sector grew by 1.0% and the construction sector fell by 1.6%.80

In Q4 2009, the service sector grew by 0.2%, the production sector grew by 0.8% and the
construction sector fell by 2.8%. The UK service sector grew by 0.5%, the production sector
grew by 0.4% and the construction sector declined by 0.9%, over the same period.81

During Q1 2010, service sector output in Scotland fell by 0.2%. Within services, financial
services (+2.5%) and public administration, education & health (+0.8%) experienced growth.
There was a fall in output from other services (-0.1%), transport, storage & communication
(-0.2%), hotels & catering (-0.5%), retail & wholesale (-1.0%) and real estate & business
services (-1.9%).

Overall output in the production sector remained unchanged from Q4 2009. Within
production there was growth in mining & quarrying (+3.0%) and electricity, gas & water
supply (+0.7%), while the manufacturing sector experienced a fall of 0.3%.

Within manufacturing there was growth in food, drink & tobacco (+1.5%), chemicals & man-
made fibres (+2.7%), other manufacturing (+0.7%), textiles, footwear, leather & clothing
(+4.7%) and metals & metal products (+0.5%). There was falling output in refined petroleum
& nuclear fuel (-0.4%) and engineering & allied industries (-3.5%).82

Different economies experience different cycles. The depth and length of a recession can
vary as can the size and timing of the recovery phase. The UK was the last G783 country to
come out of recession, following 0.3% growth in Q4 2009 after 6 consecutive quarters of
falling output. This contrasts with the US, which recovered strongly in the second half of
2009 with growth of 0.6% in Q3 2009 and 1.4% in Q4 2009. The sharpest recoveries have
been in the emerging and developing economies, particularly in Asia. These economies
were not affected to the same extent by the international financial crisis.84

GVA per head of population for the UK as a whole (excluding extra-regio territories85), was
£20,000 in 2007. In 2004, the average was £16,800.86 The table below shows that between
2000 and 2007, GVA and GVA per head in Scotland grew faster than the UK average. In
terms of average annual percentage growth in GVA between 2000 and 2007, the East
Midlands, London, Northern Ireland and the East of England had the highest GVA growth,
while the West Midlands and Wales had the lowest. Average annual percentage growth of
GVA per head was highest in Scotland, London, Northern Ireland and the North East, while
the West Midlands, Yorkshire and the Humber and Wales grew slowest.




80 Scottish Government (2010), Gross Domestic Product for Scotland, Quarter 1 2010
81 Scottish Government (2009), Gross Domestic Product for Scotland, Quarter 4 2009
82 Scottish Government (2010), Gross Domestic Product for Scotland, Quarter 1 2010
83 The G7 is an economic and political grouping consisting of Canada, France, Germany, Italy, Japan, the UK, and the USA.
84 Scottish Government (2010), The Scottish Economic Recovery Plan: Accelerating Recovery, p.11
85 Extra-regio territory is made up of parts of a national economic territory which cannot be attached directly to a single region
that is part of the national geographic territory. It consists of:
a. national airspace, territorial waters and the continental shelf lying in international waters over which the country enjoys
      exclusive rights;
b. Territorial enclaves (i.e., geographic territories situated in the rest of the world and used by government agencies of the
      country (embassy, consulates, military bases, scientific bases, etc.));
c. Deposits of oil, natural gas, etc. in international waters outside the continental shelf of the country, worked by units
      resident in the territory. (The Euro Stat Concepts and Definitions Database (1996), Regional Accounts Methods -
      Accounts, p.5)
86 ONS (2008), Regional, sub-regional and local GVA



                                                                                                                               49
           Table 54: GVA and GVA per head for Scotland and the UK, 2000 & 2007

                   GVA (£ million)                                Scotland                     UK
 2000                                                              67,200                   842,500
 2007                                                              98,900                  1,216,900
 Average annual % growth 2000-2007                                  5.7                       5.4
             GVA per head (£)                                     Scotland                     UK
 2000                                                              13,300                    14,300
 2007                                                              19,200                    20,000
 Average annual % growth 2000-2007                                  5.4                       4.9
Source: ONS (2009), ‘Regional Economic Indicators, with a focus on industries in the UK regions’, Economic &
Labour Market Review, Volume 3, No. 11

The figure below shows historic changes to GVA, by sector, in Scotland. It can be seen that
between 2004 and 2009, there have been increases in total GVA in the service sector, and
declines in agriculture, forestry & fishing, construction, and production. However, it can also
been seen that until Q3 2008, the construction sector had enjoyed a period of growth. Q3
2008 represents in the biggest change in the Scottish GVA between 2004 and 2009.

              Figure 17: Historic changes to Scottish GVA, by Sector, 2004 - 2009
 120




 110




 100




  90
              Total Gross Value Added           Agriculture, Forestry & Fishing   Production
              Construction                      Services
  80
       Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

            2004               2005             2006                2007            2008              2009
Source: Scottish Government (2010), Gross Domestic Product for Scotland, Quarter 4, 2009

The tables below detail the GVA and GDHI levels for Angus in comparison to other areas. It
shows that GVA per head of population in Angus was lower than all its neighbouring local
authorities, and significantly lower than the national average. In terms of GVA by industry in
1999, 2002, 2005 - 2007, it can be seen that Angus that there were many fluctuations in
GVA, although the GVA per employee was rising consistently, it was not always in keeping
with the national average. However, in 2007, the levels for the construction and services
sectors were above the national average, and the manufacturing sector had improved
slightly on the year before (although it had declined significantly from its 1999 level).




                                                                                                               50
   Table 55: GVA at basic prices per employee (£) by Industry in 1999, 2002, 2005 – 2007

                                Angus as      Angus as     Angus as     Angus as     Angus as
                       Angus     a % of Angus a % of Angus a % of Angus a % of Angus a % of
                                Scotland      Scotland     Scotland     Scotland     Scotland
                            1999                  2002                   2005                 2006                 2007
Construction         21,505        80       36,267      111      44,007       108      36,444        76      57,571       115

Manufacturing 34,929               96       28,683       66      44,325         82     48,590        79      49,701        81

Services*            18,304        87       20,219       79      25,305         94     26,883        90      30,234       103
* ‘Services’ excludes: Financial Intermediation, Public Administration and Health & Social Work
Source: Scottish Government Analytical Service Division (2006 & 2009), Angus Economic Briefing.

Some information is only available at a NUTS 3 level 87, which sees the information for
Angus combined with Dundee. While this blurs the picture to some degree, it still allows for
a comparison to be made with other areas.

      Table 56: Headline GVA at current basic prices, by NUTS 3 regions, 1995 and 2006

                                                                                                           per head index
                                                       £ million                  £ per head
                                                                                                             (UK = 100)
                                                  1995          2006          1995           2006           1995         2006
Scotland                                         55,922        93,361        10,957         18,246           100          96
Aberdeen City & Aberdeenshire                    7,109         10,879        15,942         24,550           144         130
Angus and Dundee City                            2,725          4,132        10,321         16,431            93          87
Perth & Kinross and Stirling                     2,254          4,020        10,453         17,632            95          93
Source: ONS, Regional Accounts (Available from: www.statistics.gov.uk/downloads/theme_economy
/PROGRESS _NUTS3.xls). Estimates of regional GVA in this table are on a workplace basis, where the income
of commuters is allocated to the region in which they work. Components may not sum to total due to rounding.

GDHI is defined as household income less payment of tax, NI and contributions to life
assurance and pension schemes.

                  Table 57: Headline GDHI per Head Indices at Current Basic Prices

                                     1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Scotland                               94       93        93        93       94        94       94        95        95       95
Aberdeen City &
                                      105       103      103       102      102      1047       105       107      107      108
Aberdeenshire
Angus & Dundee City                    92       91        91        92       92        92       91        90        90       90
Perth & Kinross & Stirling 106                  104      103       102      102       103       104       106      107      107
Source: ONS, Regional Accounts



87 Nomenclature of Units for Territorial Statistics (NUTS). NUTS was created by the European Office for Statistics (Eurostat)
as a single hierarchical classification of spatial units used across the EU. At the top of the hierarchy are the individual member
states of the EU: below that are levels 1 to 3. For further information, please refer to www.statistics.gov.uk/geography/
nuts_scot.asp.



                                                                                                                                51
                                                  ,
In terms of business formation and survival rates, research has shown that Angus has lower
levels of start up businesses than the national average. These figures also reveal that the
sectoral structure of Angus, which will be discussed more fully later, is reflected in the nature
of the enterprises registered. These figures only reflect companies who have registered as a
Value Added Tax (VAT) enterprise, companies which have a turnover greater than the
current VAT threshold. The threshold for the financial year 2006/07 was £61,000. It is
currently £67,000.88

   Table 58: Stock of VAT registered enterprises and VAT registrations & de-registrations,
                                          200689

                                                                                         Per 10,000                                 Registrations by sector as
                                      Total
                                                                                         population                                  a % of all registrations




                                                                                                                                 forestry, fishing,
                                                                  Deregistrations




                                                                                                               Deregistrations



                                                                                                                                  energy & water

                                                                                                                                                       Manufacturing
                                         Registrations




                                                                                              Registrations




                                                                                                                                                                       Construction
                                                                                                                                   Agriculture,




                                                                                                                                                                                      Services
                           Stocks




                                                                                     Stocks
UK                    1,917,615 182,205 143,070 394                                           37               29                  2.2%               5.1% 12.6% 80.1%
Scotland               134,295        11,825                    9,230               322       28               22                  4.9%               4.5% 12.7% 77.9%
Aberdeenshire           10,355          785                     580                 549       41               31                 12.1%               5.1% 12.7% 69.4%
Angus                     3,025         240                     175                 340       27               20                  6.3%               6.3% 10.4% 75.0%
Dundee City               2,460         225                     190                 208       19               16                  0.0%               2.2% 11.1% 86.7%
Perth &                   5,225         345                     325                 461       30              28                   7.2%               5.8% 11.6% 75.4%
Kinross
Source: Department for Business Enterprise and Regulatory Reform (2007). The population figure is at mid
2006.

             Figure 18: VAT Registrations and De-registrations in Angus, 1994 – 2007
   320
   300

   280
   260
   240
   220

   200
   180
   160
                                                                Registrations                  De-registrations
   140
           1994    1995     1996 1997                    1998    1999               2000 2001                 2002               2003          2004 2005                   2006 2007
Source: Nomis (2009), VAT Registrations/Deregistrations

88 ONS (2009), Business: Activity, Size and Location – 2009
89 The stock of VAT registered enterprises is the number of enterprises registered for VAT at the start of the year. This is an
indicator of the size of the business population. VAT registrations are the number of enterprises registering for VAT each year.
This is an indicator of business start-ups.



                                                                                                                                                                                                 52
The Committee of Scottish Clearing Bankers collates quarterly statistics on new business
start-ups based in Scotland that have opened accounts with any of the 4 Scottish Clearing
Banks. The 4 clearing banks in Scotland are the Bank of Scotland, the Clydesdale Bank,
Lloyds TSB Scotland and the Royal Bank of Scotland.

                          Table 59: Number of new businesses in Scottish Banks

             Y/E             Y/E              Q1              Q2              Q3               Q4              Y/E
                      %               %                %               %               %               %                %
            2007            2008             2009            2009            2009             2009            2009
Aberdeen
         1,615       6.4    1,261     6.3    250      6.0     260     5.9     239      6.2    182      5.5     931     5.9
shire

Angus        521     2.1     465      2.3     81      1.9     109     2.5      84      2.2     72      2.2     346     2.2

Dundee
             552     2.2     506      2.5     95      2.3     116     2.6      87      2.3     73      2.2     371     2.4
City
Perth &
             681     2.7     655      3.3    137      3.3     153     3.5     120      3.1    108      3.3     518     3.3
Kinross

Scotland 25,041            20,028           4,166            4,383           3,861           3,316           15,726
Source: The Committee of Scottish Clearing Bankers (2009), Quarterly Statistics for New Business.
% is of the Scottish total.

Commentators have suggested a number of reasons for Scotland’s low VAT registration
rate, including lower household income, levels of wealth and home ownership; an ageing
population; smaller existing business base; under-representation of business services in the
economy; and a higher proportion of UK public sector employment.90 It would seem that
Angus follows this pattern.

                                                    Enterprise size.

Small and medium sized enterprises (SMEs) in Angus employ a significantly greater
proportion of all workers compared to Scotland as a whole. The Scottish Government’s
Analytical Service Division define a small enterprise as having fewer than 50 employees
throughout the UK, with a medium sized enterprise having between 50 and 249 employees
throughout the UK, and a large enterprise having 250 or more employees throughout the
UK. The tables below show how this relates to Angus and Scotland, and also provide
breakdown on how this compares to the neighbouring LAs, and how it breaks down across
the sectoral structure.

The following tables show that in Angus between 2006 and 2008, there has been an
increase in the number employed by SMEs, while the number employed by large companies
has remained static. There has been an increase in the proportion of staff employed by
SMEs, while the proportion of those employed by large companies has decreased.
Nationally, there has been an increase over all three size brackets, and the proportion levels
have remained static.

Perhaps more significant is that the figures reveal that there has been no increase in the
total employment figures for Angus. This is not the case for Scotland, which has seen
employment growth of 57,000.



90 Scottish Executive (2005), Submission to the Scottish Parliament, Enterprise and Culture Committee, ‘Business Growth -
the next 10 years’, p.15.



                                                                                                                            53
                    Table 60: Employment by Size of Enterprise, March 2006 & 2008

                                                               Angus                                                                                 Scotland
   Total                    2006                    2008                     2006                  2008                2006                   2008                2006                       2008
 employment                       No. (000s)                                                   %                             No. (000s)                                          %
                                27                     27                    100%                  100%                1,751                  1,808               100%                       100%
 Small                          14                     15                    54%                   55%                      609                634                 35%                       35%
 Medium                           4                        5                 16%                   17%                      244                253                 14%                       14%
 Large                            8                        8                 30%                   28%                      898                920                 51%                       51%
Source: Scottish Government Analytical Service Division (2006 & 2009), Angus Economic Briefing.

Table 61: Number and Proportion of Enterprises, by Size of Enterprise, March 2006 & 2008

                                                                  Angus                                                                             Scotland
                                      2006                     2008              2006               2008               2006                     2008                  2006                   2008
                                            Number                                             %                               Number                                              %
  All enterprises                    3,630                 3,800               100%                100% 147,490                               154,640                100%                    100%
 Small                               3,390                 3,560                 93%                94%            141,760                    148,770                  96%                    96%
 Medium                                 100                     90                 3%                 2%              3,480                    3,580                       2%                 2%
 Large                                  150                    160                 4%                 4%              2,260                    2,290                       2%                 1%
Source: Scottish Government Analytical Service Division (2006 & 2009), Angus Economic Briefing.

The following table shows the number of registered enterprises in Angus and its
neighbouring LAs. It shows that 93.6% of Angus’ 3,800 registered enterprises employ fewer
than 49 employees, and account for 51% of the county’s turnover. Conversely it shows that
enterprises employing between 50 and 249 staff account for 2.4% of enterprises and
generate 17% of the county’s turnover, with firms employing more than 250 staff accounting
for 4% of enterprises and generating 32% of the total turnover figure.

         Table 62: Number of Registered Enterprises in Scotland and their Total Scottish
                           Employment and Turnover, March 2008

                           Total                                   0 - 49 employees                             50 - 249 employees                                250+ employees
                           Total Scottish




                                                                              Total Scottish




                                                                                                                             Total Scottish




                                                                                                                                                                            Total Scottish
                            employment




                                                                               employment




                                                                                                                              employment




                                                                                                                                                                             employment
                                                                                               (£ millions)




                                                                                                                                              (£ millions)
             enterprises




                                                               enterprises




                                                                                                              enterprises




                                                                                                                                                             enterprises
                                            (£ millions)




                                                                                                                                                                                              (£ millions)
             Number of




                                                               Number of




                                                                                                              Number of




                                                                                                                                                             Number of
                                             Turnover




                                                                                                Turnover




                                                                                                                                               Turnover




                                                                                                                                                                                               Turnover




    LA


Aberdeen
         12,380 74,060 10,677                              11,950 42,230 4,276                                 215           11,260 1,647                     210          20,570 4,753
shire
Angus    3,800 27,200 2,595                                    3,555 14,970 1,320                               90           4,630             441            155           7,600              834
Dundee
         3,455 52,380 4,164                                    2,855 14,450 1,037                              185           8,670             760            420          29,260 2,366
City
Perth &
         6,310 49,710 6,576                                    5,795 23,570 1,958                              180           7,460             675            335          18,680 3,944
Kinross
Source: Scottish Government (2009) Scottish Economic Statistics 2008. Excludes central and local government.




                                                                                                                                                                                                       54
This information reflects employee size bands on the basis of their total UK employees. The
rationale behind this approach, according to the Scottish Government, is that the size of the
overall enterprise determines its behaviour as an economic agent. An enterprise with a
large number of employees in the UK as a whole is likely to behave like a large enterprise,
irrespective of its level of Scottish employment.

The following table reports on the number of business sites; these are classified by the total
number of employees at that site.

 Table 63: Number of Business Sites of Registered Enterprises, Sector and Employee Size
                          Band of Site, March 2009 - Angus.91




                                                                                                                                                                                                                                           O Other community, social
                                                                                                                                                                                    K Business activities, real
                                                                                                                                                       J Financial intermediation
                                                                                                 H Hotels and restaurants


                                                                                                                            I Transport, storage and
                                                                       G Wholesale, retail and




                                                                                                                                                                                                                  M, N Education, health



                                                                                                                                                                                                                                             and personal services
              A, B, C, E Primary



                                   D Manufacturing




                                                                                                                                                                                                                     and social work
                                                                                                                                 communication
                                                      F Construction




                                                                                                                                                                                         estate, renting
                  Industries




                                                                              repairs




                                                                                                                                                                                                                                                                        Total
  Size
  band




0-4           630                  155               345               550                       185                        105                        25                           730                              95                    195                         3,015
5-9             65                 30                 45               150                       65                            20                      15                               60                           30                        50                      535
10 - 14         30                 15                 25                  55                     25                                5                    5                               25                           30                        20                      235
15 - 49         15                 30                 15                  60                     30                            25                       5                               30                           45                        15                      265
50 +               0               25                 5                   15                      5                                5                    0                                   0                        10                           5                     75
Total         740                  260               440               825                       300                        160                        50                           845                           215                      285                         4,125
Source: Scottish Government (2009), Scottish Corporate Sector Tables


This shows a markedly different picture with the number of companies having more than 50
staff on one site in Angus reduced to 75. Sites are allocated a size band by their total
number of employees at that business site. The prevalence of small businesses is again
clear.

                                                     Sectoral Structure of the Angus Economy

Angus was traditionally heavily dependent on farming, food production & processing
(including fishing industries), and textile industries. The development of technology and the
energy sector in the north east has enabled diversification into the fields of engineering, oil,
gas and pharmaceuticals. The table below shows the number of registered enterprise in
Angus, and their distribution across different sectors, and compares this to the national
average. The cells marked in red indicate the sectors in which Angus is below the national
average, and the cells marked in blue indicate areas where it is over represented.




91 Sites are allocated a size band by their total number of employees at that business site.
   Excludes central and local government. Totals may not equal the sum of the constituent parts due to rounding.



                                                                                                                                                                                                                                                                                55
          Table 64: Number of registered enterprises* in Angus by sector March 2009

                                                                           Angus                   Scotland
                                                               No of            % of total       % of total
                         Sector
                                                             Enterprises       enterprises      enterprises
 A, B, C, E Primary Industries                                  735               19.5             12.6
 D Manufacturing                                                  240               6.4              6.0
 F Construction                                                   430               11.4             11.1
 G Wholesale, retail & repairs                                    675               17.9             17.3
 H Hotels & restaurants                                           285               7.5              8.3
 I Transport, storage & communication                             135               3.6              3.9
 J Financial intermediation                                        30               0.8              1.1
 K Business activities, real estate, renting                      805               21.3             26.8
 M, N Education, health & social work                             185               4.9              4.9
 O Other community, social & personal services                    260               6.9              8.0
 Total                                                           3,775
*Excludes central and local government.
Source: Scottish Government (2009), Scottish Corporate Sector Statistics

As it can be seen in the table below, in 2008, employment in Angus was dependent on the
service sector, which accounted for 71% of jobs. Angus also has a relatively high share of
employment in manufacturing (14%). This is above the Scottish average of 8%. There is
also a reliance on primary industries, in particular agriculture, forestry& fishing (which
represented 7% of employees) compared with 2% for Scotland as a whole.

              Table 65: Number and proportion of Employee jobs by industry, 2008

                                                                     Angus                    Scotland
                                                             No. (000s)        %      No. (000s)           %
 All industries                                                  36.9        100%          2,420.4     100%
   Agriculture, forestry & fishing                                2.5         7%            36.5         2%
 Production & construction total                                  8.1         22%          407.4       17%
   Mining & Energy                                                0.5         1%            57.3         2%
   Manufacturing                                                  5.3         14%          199.0         8%
   Construction                                                   2.4         7%           151.1         6%
 Services total                                                  26.3         71%          1,976.6     82%
   Retail & wholesale & accommodation & food                      8.6         23%          535.2       22%
   Transport & communications                                     1.4         4%           162.0         7%
   Finance & business                                             3.7         10%          444.9       18%
   ‘Other’ Services¥                                             12.7         34%          834.4       34%
Source: Scottish Government Analytical Service Division (2010), Angus Economic Briefing.
¥ Other services includes Public Admin, Education, Health and ‘Other' Services

The table above reflected the position in 2008, but does not take into account central or
local government. It shows that Angus is below the Scottish average in the following
sectors; hotels and restaurants, transport, storage & communications, financial



                                                                                                               56
intermediation, business activities, real estate & renting, and ‘other’ community, social &
personal services.

Research conducted by DTZ Pieda suggests that Angus has an over-dependence on some
slow growing/declining sectors while having a relative lack of growth industries (such as
business services and electronics) with the economy showing relatively low signs of overall
dynamism.92 Service sector jobs in Angus increased by 2.3% between 1999 and 2005, and
by 0.4% in 2006/07. The figures for Scotland were 19.8% and 1.5% respectively.93

The table below demonstrates employment levels and rates across the difference sectors,
and compares Angus to the national rate. Again the cells marked in red indicate the sectors
in which Angus is below the national average, and the cells marked in blue indicate areas
where it is over represented. The only difference in the 2 comparisons is that Angus has
more staff employed in ‘other’ community, social & personal services than the national
average, despite having fewer enterprises registered. The tables exclude central and local
government (as defined by the legal status of the enterprise); however, the small number of
enterprises that provide support services to public administration are for these tables
included with the sector 'other’ community social and personal services. This may
contribute to the discrepancy here, as it was previously mentioned that employment in
Angus is over dependent on the service sector.

                                   Table 66: Total Employment* by Sector

                                                                             Angus              Scotland
                                                                   Total Scottish
                                                                                   % of total   % of total
                                                                   Employment
 A, B, C, E Primary Industries                                           3,150        11.1         5.6
 D Manufacturing                                                         4,830        17.1        11.7
 F Construction                                                          2,300        8.1          7.4
 G Wholesale, retail & repairs                                           6,230        22.0        19.8
 H Hotels & restaurants                                                  2,350        8.3          8.5
 I Transport, storage & communication                                    1,230        4.3          6.3
 J Financial intermediation                                               330         1.2          5.3
 K Business activities, real estate, renting                             3,100        11.0        18.2
 M, N Education, health & social work                                    3,100        11.0        11.7
 O Other community, social & personal services                           1,670        5.9          5.5
 Total                                                                  28,280
*Excludes central and local government.
Source: Scottish Government (2009), Scottish Corporate Sector Statistics

The table below shows the levels of change in the sectoral structure of Scotland and Angus
since 1999. However, the 1999/2005, and 2006/2007 are not comparable due to changes in
methodologies used when compiling the figures. However, they are still useful.

In the period between 1999 and 2005, the number of employee jobs in Angus fell by 5.1%
while for Scotland, there was an increase of 10.7%. In 2006/07, the number of jobs in Angus
increased by 1.1%, while the figure for Scotland was 1.3%.



92 Ekos Ltd (2003), Economic Development Strategy for Angus.
93 Scottish Government Analytical Service Division (2009), Angus Economic Briefing.



                                                                                                             57
This is encouraging, as it suggests that Angus is narrowing the gap. In the period since
1995 the number of jobs created in Angus has risen at double the rate of the Scottish
average, however the proportion of these jobs has not followed the national trend. In the
case of the business & finance sector, there has been a decrease recorded, and this is one
of the areas in which Angus is traditionally weak.

It can be seen that Angus was only above the Scottish average in the agriculture, forestry
and fishing, transport & communications, and ‘other’ services sectors in the 2006/2007
period. In this table, ‘other’ services does include public administration, education, health
and other services. Again the cells marked in red indicate the sectors in which Angus is
below the national average, and the cells marked in blue indicate areas where it is over
represented.

                                   Table 67: % Change in Employee Jobs

                                                               Angus                       Scotland
                                                  1999/2005          2006/2007    1999/2005     2006/2007
All industries                                        -5.1%              1.1%      10.7%              1.3%
Agriculture, forestry & fishing                      18.8%               35.0%      -3.5%             1.0%
Production & construction                            -27.1%              -4.9%     -18.7%             0.0%
  Energy & Water                                     -71.4%              0.0%      -10.7%         10.7%
  Manufacturing                                      -28.4%              -1.9%     -27.1%         -1.4%
  Construction                                       -12.0%              -12.0%     -1.5%         -0.6%
Services                                              2.3%               0.4%      19.8%              1.5%
  Retail & wholesale & hotels                         5.6%               -1.1%      8.4%          -0.4%
  Transport & communications                          -8.3%              8.3%       8.7%              7.3%
  Finance and business                               14.3%               -5.9%     32.3%              3.5%
  ‘Other’ Services¥                                   -1.5%              2.9%      24.0%              1.3%
¥ Other services includes Public Administration, Education, Health and Other Services
Source: Scottish Government Analytical Service Division (2009), Angus Economic Briefing.

FutureSkills Scotland predicts that in Scotland’s labour market there will be a modest growth
in the number of jobs, coupled with considerable demand for new employees to replace
those who leave employment. They also envisage that employment growth will be
concentrated in public and private service industries and higher skilled and service
orientated occupations, with large number of jobs arising in service industries and
managerial and professional occupations.94

It is also expected that employment will move away from predominately manual occupations,
such as skilled trades and elementary occupations, towards professional and higher skilled
occupations. Total employment in three occupational groups; professional occupations;
managers and senior officials; and associate professionals is predicted to be accountable for
4 in 10 of all jobs in Scotland by 2017. These three occupations - as well as sales and
customer services occupations – are expected to dominate employment growth in Scotland
between 2007 and 2017.95

The graph below illustrates the levels of employment in various industries across Scotland
between 1987 and 2012.

94 FutureSkills Scotland (2008), Labour Market Projections 2007 - 2017
95 FutureSkills Scotland (2008), Labour Market Projections 2007 - 2017



                                                                                                             58
    Figure 19: Historical and Projected Employment by Industry in Scotland, 1987 – 2012
  450,000

  400,000
                                1987                       1997                              2007                                       2012
  350,000

  300,000

  250,000

  200,000

  150,000

  100,000

   50,000

        0
                                                                                                                                                                                                            Transport & telecommunications
                                                                                              Rest of manufacturing




                                                                                                                                                                Retail & distribution




                                                                                                                                                                                                                                             Banking & insurance




                                                                                                                                                                                                                                                                                             Public admin & defence
                                                                               Engineering




                                                                                                                      Electricity, gas & water




                                                                                                                                                                                                                                                                                                                                  Health & social work
                                                                                                                                                                                                                                                                   Other business services




                                                                                                                                                                                                                                                                                                                                                         Miscellaneous services
              Agriculture etc

                                  Mining & quarrying

                                                       Food, drink & tobacco




                                                                                                                                                                                        Hotels & catering




                                                                                                                                                                                                                                                                                                                      Education
                                                                                                                                                 Construction




Source: FutureSkills Scotland (2008), Labour Market Projections 2007 – 2017

The projected decline in the number of working age people in the Angus labour market,
combined with a growth in jobs suggests that the labour market will tighten, with competition
for ‘desirable’ jobs becoming stronger.

The Strategic Futures Team at Scottish Enterprise believe that it is ‘high knowledge/non-
routine’ jobs are those which will flourish in the labour market of the future. They have
attempted to classify the tendency for computerisation to impact on routine, repetitive tasks
by categorising occupations by the extent to which they are:

            low knowledge                                                                                                                              high knowledge
            routine                                                                                                                                    non-routine

Technological change has caused a major increase in skills needs due to changing
processes and/or technology. New technology often means that manual workers are now
less involved in the repetitive operative tasks and are required to have a greater
understanding of the process.96 Low-skilled jobs in which employees are required to
exercise a certain level of discretion as expected fare better than those which require limited
judgement. Hairdressing, for example, is traditionally regarded as a fairly low-skill



96 TERU, University Of Glasgow (2004), Local Economic Development, Dynamics Of Labour Markets, p.22



                                                                                                                                                                                                                                                                                                                                                         59
occupation, however, the discretionary aspect of the job, removes much of the routine from
the task and prevents this occupation being dominated by automation.97

FutureSkills Scotland expect almost 60% of job openings to occur in just 4 industries – other
business services (services such as accounting, legal and marketing), retail and distribution,
health & social work, and education. Only some of these sectors have seen an increase in
employee jobs in Angus, namely ‘other’ services, and distribution (as illustrated in table 67).
Employment is expected to shift away from primary and manufacturing industries towards
public and private service industries.98

However, it is also predicted that the anticipated number of job openings for new employees
over the next 5 years is large for every occupational group. The most highly skilled
occupations, such as managerial and professional jobs, will account for almost half of all job
openings. However, there will also be substantial job opportunities in lower skilled jobs.99

Primary industries are defined as agriculture, forestry and fishing. Secondary industries
include energy, mining and quarrying, manufacturing and construction. Tertiary industries
are made up of wholesale, retail and repairs, hotels and restaurants, transport, financial
services and education and health.100 The graph below shows the relative significance of
primary, secondary and tertiary industries to different geographical areas in Scotland.
Angus, according to its ‘Urban Rural Classification’, follows this pattern, as demonstrated
below.

Figure 20: Significance of Primary, Secondary and Tertiary Industries and the Public Sector
                               by Geographic Area, 2007 (%)
   70
           Primary Industry       Secondary Industry         Tertiary Industry    Public Sector
                                                                                                       59
   60

                             46                                    46
   50


   40

                                                                                                                 26
   30
                                    21                       22              21
               16     17
   20
                                                                                                  15

                                                     11
   10

                                                                                           0.4
    0
                    Remote Rural                          Accessible Rural                    Rest of Scotland
Source: Scottish Government (2009), Rural Scotland Key Facts 2009.

The following pages present a brief analysis of the key sectors of the Angus economy.


97 TERU, University Of Glasgow (2004), Local Economic Development, Dynamics Of Labour Markets, p.22
98 FutureSkills Scotland (2008), Labour Market Projections 2007 - 2017
99 FutureSkills Scotland (2006), Labour Market Projections to 2014.
100 Scottish Executive (2006), Rural Scotland Key Facts 2006.



                                                                                                                      60
                                  ENVIRONMENTAL AND LAND-BASED SECTOR

Angus covers 189,812 hectares of agricultural land, equivalent to 3% of the total Scottish
                       101
agricultural land area.    In 2003, it was estimated that the environmental and land based (E
& LB) sector in Angus employed approximately 37,100 employees, equating to
approximately 2% of all Scottish jobs (this figure differs from the one given above, because it
includes veterinary activities, and botanical & zoological gardens and nature reserve
activities).

The sector skills council for the E & LB sector - LANTRA – recognises 17 industries,
comprising approximately 24,500 businesses. The total land-based workforce is
approximately 115,700 and a further 40,000 volunteers also work on a regular basis across
the sector.102

LANTRA presently recognises the following industries and professions:

               Agricultural crops/livestock                       Fisheries management
               Animal care                                        Floristry
               Animal technology                                  Game and wildlife management
               Aquaculture                                        Land-based engineering
               Environmental conservation                         Landscape
               Equine                                             Production horticulture
               Farriery                                           Trees and timber
               Fencing                                            Veterinary nursing

Micro-businesses predominate across the sector, with 96% of businesses within the sector
employing less than ten staff or no staff. The table below shows the comparison between the
sector, and the economy as a whole.

             Table 68: Numbers of Staff Employed in the E & LB Sector, by Size Band

 Number of staff                                    E & LB Sector                                 Scotland
 0–4                                                    87%                                         63%
 5–9                                                     9%                                         17%
 10 – 49                                                 4%                                         16%
 50 – 249                                                 *                                          3%
 250+                                                     *                                          1%
* Less than 0.5%
Source: Lantra (2009), Environmental and Land-based Industries – Labour Market Information.

Self employed workers in the sector account for 43% of all employment, the highest of any
industrial sector, and significantly higher than the 10% national average.103

All of the 17 industries report difficulties in recruitment and retention. Current skills gaps
include management and planning, ICT and technical, communications, literacy and
numeracy skills. Much of the land-based workforce is highly skilled in technical areas, with
years of vocational experience, although these skills are often unaccredited and not
recognised. 104



101 SAC Rural Business Unit (2003), Agriculture and its Future in Rural North East Scotland – Assessment of the Impact of
Reform of the Common Agricultural Policy, p.51
102 Lantra (2009), Environmental and Land-based Industries – Labour Market Information.
103 Lantra (2009), Environmental and Land-based Industries – Labour Market Information.
104 Lantra (2006), Scotland Sector Skills Agreement, p.3



                                                                                                                            61
In 2003 agricultural output from Angus was estimated at £91.2 million (an increase from the
1997 sum of £88.1 million), of which £20.2 million came directly from EU subsidies. A
Scottish Agricultural College study undertaken in 2003 to assess the impact of reform of the
Common Agricultural Policy (CAP) in Angus predicted that this output would decline by
between £2.9 million and £8.4 million by 2007 as a result of the reforms. This drop in output
was also expected to reduce inputs into agriculture (e.g. seed, fertiliser, sprays etc) and to
reduce employment in the sector by between 171 and 448 full time equivalent (FTE) jobs by
2007.105

Difficulties exist in analysing whether these predictions were realised on not. Information is
not readily availably at an LA level. However, in 2008, Total Income from Farming (TIFF) for
Scotland was estimated to decrease by around 1.8% (£11.9 million) before inflation was
taken into account. In real terms, this represents a fall of around 5.6%.106

The Single Farm Payment Scheme (SFPS) was introduced on 1 January 2005. It is part of
the package that reformed the CAP. It replaced previous production based support
schemes. In 2008, the SFPS was valued at £431.4 million, an increase of £37.7 million
(9.6%) on the 2007 levels, mainly due to a more favourable exchange rate in 2008 (as SFP
is initially valued in Euros).107

The reform of the CAP also created a second policy pillar – The Rural Development
Regulation (RDR). This looks to promote diversification of the rural business base, add
value to rural produce, increase the rural skills base, support environmental management,
and to extend woodlands. Research has suggested that substantial amounts of money will
be taken from the SFP through modulation (the transfer of funds from farming subsidies to
rural development schemes), and that farmers in Angus will have to take advantage of the
RDR funded schemes to get this money back. To maintain a fair regional balance, money
from modulation plus the match funding will be spent by the same regional government
authorities as applied modulation. In other words, all money raised by the Scottish
Government from modulation will be used to help fund measures administered by the
Scottish Government. This does not mean however that all monies raised in Angus, will be
spent in Angus.

The rate of compulsory modulation is set by the EU and is the same across all of the UK
regions. However, the rules for additional voluntary modulation allow each administration in
the UK to set modulation rates according to their own rural development needs and
priorities. This can be seen in the table below.

                                           Table 69: Modulation Rates

                         2008                 2009                 2010                 2011                  2012

  England           5+13 =18%             7+12 =19%            8+11 =19%            9+10 =19%             10+9 =19%

    Wales          5+2.5 =7.5%           7+2.2 =9.2% 8+2.8 =10.8% 9+2.5 =11.5% 10+1.5 =11.5%

  Scotland          5+8% =13%           7+6.5 =13.5%            8+6 =14%             9+5 =14%             10+4 =14%
  Northern
                     5+6 =11%              7+5 =12%             8+5 =13%             9+5 =14%             10+4 =14%
   Ireland
Source: Defra (2009), Single Payment Scheme - Further information: Modulation question & answers


105 SAC (2003), Agriculture and its Future in Rural North East Scotland - Assessment of the Impact of Reform of the CAP.
106 Scottish Government (2009), Economic Report on Scottish Agriculture.
107 Scottish Government (2009), Economic Report on Scottish Agriculture.



                                                                                                                           62
The RDR part funds the Scottish Rural Development Programme 2007 – 2013 (SRDP) - a
£1.6 billion programme of economic, environmental and social measures designed to
develop rural Scotland over the next six years. Individuals and groups can seek support, and
measures are delivered through the:

        Crofting Counties Agricultural Grant Scheme;
        Food Processing, Marketing and Co-operation Grant Scheme;
        Forestry Commission Challenge Funds;
        The LEADER initiative;
        Less Favoured Area Support Scheme;
        Rural Development Contracts; and
        Skills Development Scheme.

The SRDP brings together a wide range of formerly separate support schemes including
those covering the farming, forestry and primary processing sectors, rural enterprise and
business development, diversification and rural tourism.

Funding for the SRDP comes from the Scottish Government and the European Agricultural
Fund for Rural Development and Voluntary Modulation. Approximately two-thirds of the
funding comes from Scottish Government resources.

Agriculture accounted for 0.7% of Scottish GVA in 2007 (higher than the UK level of 0.5%).
GVA in the agricultural sector increased consistently during the period of 1999 to 2004 and
then dropped sharply from £1 billion to £0.6 billion in 2005 due to the change from subsidies
to direct payment. Since 2005, GVA in agriculture has increased and stood at £0.8 billion by
2008.108

Agriculture accounted for around 2.5% of employment in Scotland.109 However, the extent of
agricultural employment tends to be somewhat exaggerated due to the increasing
pluriactivity of farmers and farm based families for whom agriculture may only provide a
percentage of the household income. Diversification into areas such as tourism has been
encouraged to make agricultural businesses more viable. Nationally, farming is now a
minority occupation, employing no more than 400,000 of the 5.4 million people who work in
the rural economy. In comparison some 1.4 million work in hotels and tourism. In fact, a rural
employee is twice as likely to work in either manufacturing or the finance sector as on a
farm.110

Wages received in the agricultural sector are perceived as low. However, in June 2009, the
Scottish Agricultural Wages Board (SAWB) increased the minimum agricultural wage by
1.9% to £6.32 an hour, above the National Minimum Wage (NMW). This took effect from 1
October 2009, and meant;

        A minimum hourly rate of £5.80 for all workers in the first 26 weeks of employment (a
         1.2% increase).
        A minimum hourly rate of £6.32 for all workers employed for more than 26 weeks by
         the same employer (a 1.9% increase).
        The additional sum payable to workers with appropriate qualifications will increase by
         1.9% to £0.96 per hour.111



108 Scottish Government (2009), Food and Drink in Scotland – Key Facts, p.12
109 Scottish Government (2009), Scottish Economic Statistics 2008
110 R. Donkin, (2006), ‘Human Capital and Skills’ in Economic and Social Research Council, (2006), Regional Policy, p.12.
Available from www.esrcsocietytoday.ac.uk/ESRCInfoCentre/Images/regional_policy_tcm6-9629.pdf
111 SAWB (2009), Agricultural Wages in Scotland (Fourteenth Edition), A Guide for Workers and Employers



                                                                                                                      63
The NMW for an adult is £5.73. According to a Scottish Government survey of wage rates,
some 87% of agricultural workers are paid above the agricultural minimum rate. 112

The table below shows details of Scottish agricultural output, input and income from 2001 to
2007. It can be seen that TIFF has almost doubled since 2001.

                 Table 70: Scottish Agricultural Output, Input and Income, 2001-2007

                                                     2001*      2002       2003       2004      2005**       2006       2007
Output (£ million)
Agricultural activities                              1,793 1,828 1,977 2,065                     1,665       1,745 1,969
Non-agricultural activities                           107        104        113        115        125         129        142
Total Gross Output (basic prices)                    1,901 1,932 2,090 2,180                     1,790       1,874 2,111
Input                                                1,032 1,044 1,094 1,141                     1,161       1,199 1,310
GVA                                                   869        888        996      1,039        629         675        801
Consumption of Fixed Capital                          300        301        302        302        302         284        276
Net Value Added                                       569        587        694        737        326         391        526
Other Subsidies                                       110        112        125        111        496         542        525
Hired Labour                                          244        241        247        255        275         276        284
Interest                                               92         84         84         93        101         105        126
Net rent                                               17         14         15         15         12          13         13
Total Income from Farming                             326        360        472        484        435         538        628
Source: Scottish Government (2009) Rural and Environmental Analytical Services. (2006 & 2007 figures are
provisional)
* Increase in other subsidies is the result of the introduction of the new Less-Favoured Areas Support Scheme
which was worth £61m in 2001. This replaced Hill Livestock Compensatory Allowances for cattle and sheep
which were paid on headage basis and therefore considered as direct subsidies and included under agriculture
activities.
** From 2005 Other Payments and Subsidies includes SFP that replaces most production related subsidies.

                                                         FORESTRY

Forests cover 16% of Scotland's land area. The majority of the timber resource is found in
Dumfries and Galloway, the Borders, Tayside, Forth Valley, Argyll, Grampian, and the
Highlands and Islands.113

According to the Forestry Commission the southern slopes of the Grampian foothills in
Angus present excellent growing conditions for forestry. Over past years there have been
environmental and financial encouragements to plant trees and this is likely to continue
through the RDR programme. Despite this growth, forestation in Angus appears to have
been slow. This is at least in part due to investment in forestry being long term and the
market being dominated by low cost imports. Montrose Harbour, for example, is the largest
pulp handling port in Scotland.114

Total employment (direct, indirect and induced)115 in the Scottish forestry sector associated
with the use of Scottish timber is estimated to be 13,200 FTE jobs. This is made up of

112 Scottish Government (03.09.2009), ‘Agricultural Wages Board’
113 Scottish Enterprise (2009), The Forestry Industry in Scotland
114 Montrose Port Authority (2009), Cargoes – Pulp.
115 Direct employment refers to employment directly related to the production of forest products or services. As a result of this
direct employment, employment is also generated in the businesses that supply goods and services to the forest sector. This is



                                                                                                                               64
10,300 FTEs for direct employment; 1,500 FTEs for indirect employment; and 1,400 FTEs
for induced employment. The figure for direct employment equates to around 12,000 jobs,
since not all employment is full-time.116

These estimates are based upon a broad definition of the forestry sector that includes:
forestry harvesting and planting; farm woodlands; haulage; primary wood processing; pulp
and paper; the public sector; non-governmental organisations; and research and education
employment associated with Scottish forests. The estimate excludes employment associated
with the use of timber not grown in Scotland.

The total employment due to direct spending from tourism and recreation attributable to
woodland (where woodland was the primary reason for the visit), was estimated to be
around 17,900 FTE jobs. The number of volunteers in forest-related work in Scotland is
estimated to be 7,500, while the number of volunteer days in the 12 month period from mid-
2006 to mid-2007 is estimated to be 47,400.117

The total GVA (direct, indirect and induced) associated with Scottish timber is estimated to
be around £460 million at 2007/08 prices, or 0.5% of the total GVA for the Scottish economy.
This is made up of £304 million for direct GVA, £86 million for indirect GVA and £69 million
for induced GVA. These estimates are based upon the broad definition of the forestry sector
outlined above, excluding GVA associated with the use of timber not grown in Scotland.118

Overall in Scotland and GB the sector has seen a decline in employment. In Angus there
was an increase in employment from 583 to 669 between 1999 and 2002. The Dundee City
Region (DCR) has an above average level of specialisation within the forestry sector.
Employment in the sector has remained relatively stable in recent years, increasing by just
1% since 1999.119 The table below shows that while employment and the number of
businesses operating in the sector have declined nationally, the turnover and GVA of the
remaining companies has increased, suggesting some restructuring in the industry.

                   Table 71: Key Scottish Economic Indicators for Forest Industries

                                                                                       Total Change % change
                                 1998                2002                2003
                                                                                        1999 -2002 1998 -2002
  Employment                      23.9                21.8               19.4                -2.1                -8.8

  Businesses                     1833                1717                1614              -116.0                -6.3

  Turnover (£m)                 2078.7              2434.5                  -               355.8               17.1

  GVA (£m)                       657.8               798.5                  -               140.7               21.4
Source: Ecotec (2005), Forest Industries, Evaluation of Intervention with Clusters and Industries in Scotland

The Forestry Commission and the Scottish Forest Industries Cluster predict that by 2016 the
supply of softwood in Scotland will be just less than double the existing harvest and that
imports could be reduced by more than one fifth, with Scotland benefiting from a transfer of
£1.5 billion and 3,000 additional jobs, as a result. New markets are also developing for

indirect employment. Finally, when these directly and indirectly generated incomes are spent and respent on a variety of items
in the broader economy (e.g., food, clothing, entertainment), it gives rise to induced employment effects. (Source: Canadian
Council of Forest Ministers, (2005), Criteria and Indicators of Sustainable Forest Management - direct, indirect, and induced
employment)
116 Forestry Commission Scotland (2009), A Valuation of the Economic and Social Contribution of Forestry for People in
Scotland, pp. ix - x
117 Ibid
118 Ibid
119 Slims & Oxford Economics (2009), Scottish Enterprise Dundee City Region – Economic Review 2009, p. 50



                                                                                                                           65
biofuel energy production with the Scottish Renewable Order - a subsidy made to companies
which produce electricity from non-fossil fuel sources - making this kind of project more
attractive and viable.120 The Scottish Forest Industries Cluster further states that there are
clear opportunities for import substitution with minimal displacement.

                                                          FISHERIES

Scotland is among the largest sea fishing nations in Europe with 66% of the landings into the
UK. Around 90% of the UK fish farming industry is based in Scotland, particularly in the
Highlands and Islands. Scotland has over 50,000 km of rivers, many of which have wild
Atlantic salmon and sea trout, and more than 30,000 lochs and ponds.121

The number of active fishing vessels based in Scotland decreased from 2,205 at the end of
2008 to 2,174 at the end of 2009. Since 2001, the number of vessels over 10 metres has
decreased by 27%, reflecting the impact of decommissioning schemes in 2001 and 2003
which awarded grants to owners in the Scottish whitefish fleet to decommission their vessel
and surrender their fishing licence. The reduction in the number of vessels of all lengths
since 2001 is 374 (15%). The demersal sector has reduced in size steadily since 2001 by a
total of 199 vessels (42%). The pelagic sector has also declined by 31% over the same
period from 36 to 25 vessels, but has grown slightly since 2006 when there were only 21
vessels. There are currently 1,483 vessels under 10 metres, a net reduction of 121 vessels
(8%) since 2001 but only 9 fewer vessels than in 2008. 122

Scotland has 8.6% of the UK population, but landed 62% by value of the total fish catch in
2002. Fishing is of much greater importance to Scotland than to the UK as a whole.
Provisional statistics show a £47 million (12%) increase in the value of fish landed by
Scottish vessels in 2009. The figures show that 378,000 tonnes of fish were landed by
Scottish vessels with a value of £443 million.123

Scottish GVA in sea fishing increased from £95 million in 2001 to £119 million in 2006. GVA
in aquaculture increased from £74 million to £115 million during the same period.124

Direct employment in catching, aquaculture, and processing amounted to 19,800, or about
0.9% of Scottish employment in 1999. Of this, the catching sector accounted for 7,800,
aquaculture 1,600, and processing 10,400.125 If indirect effects are taken into account, the
total employment dependent on these industries rises to 48,000.126

The number of fishermen employed on Scottish fishing vessels at the end of 2009 stood at
5,409. Although this represents an increase of 1% on the figures for 2008, the 2009 figures
includes over 200 fishermen (4%) associated with a group of vessels which transferred to
Ullapool from administration ports in England. Despite this, it can be seen that this is a
significant decrease since 1999.127

Total employment in the catching sector increased from 5,424 to 5,448 in 2008, an increase
of less than 1% compared with 2007. The number of fishermen regularly employed on
Scottish based vessels in 2008, at 4,585, 4% higher than in 2007. The number of irregularly
employed fishermen decreased in 2008 by 15% to 807.128

120 Scottish Forest Industries Cluster (2009), Growth Prospects for the Industry.
121 Scottish Government (2010), Marine and Fisheries Sector - Fishing
122 Scottish Government (2010), Provisional 2009 Sea Fisheries Statistical Tables
123 Scottish Government (2010), Provisional 2009 Sea Fisheries Statistical Tables
124 Scottish Government (2009), Food and Drink in Scotland – Key Facts, p.12
125 Royal Society of Edinburgh (2004), Inquiry into The Future of the Scottish Fishing Industry, p. iii
126 Royal Society of Edinburgh (2004), Inquiry into The Future of the Scottish Fishing Industry, p. iii
127 Scottish Government (2010), Provisional 2009 Sea Fisheries Statistical Tables
128 ONS (2009), Scottish Sea Fisheries Statistics 2008, p.4



                                                                                                          66
The table below shows the value of sea fish landings from Scottish based vessels, and the
number of fishermen employed by region in 2008. It shows that the number of fishermen in
Angus 2008 was 61.

   Table 72: Value of sea fish landings into Scotland by Scottish based vessels; fishermen
                                  employed, by region 2008

                                               Landings           Labour           Fishermen          As % labour
 Region
                                               2008 (1)          Force (2)         employed              force
 Eilean Siar, Orkney & Shetland                  75.7               36                1,340              3.72
 Aberdeenshire                                  143.2               126               1,411              1.10
 Angus                                            1.2               54                 61                0.11
 Argyll & Bute                                   20.1               44                 513               1.17
 City of Aberdeen                                 6.3               113                45                0.04
 City of Edinburgh                                0.1               251                 5                0.00
 Dumfries & Galloway                              4.6               70                 171               0.24
 East Lothian                                     1.9               46                 62                0.13
 Fife                                             4.3               177                164               0.09
 Highland                                        62.9               112                794               0.71
 Moray                                            2.5               45                 270               0.60
 North Ayrshire                                   0.6               61                 29                0.05
 Scottish Borders                                 2.9               55                 79                0.14
 South Ayrshire                                   3.9               52                 504               0.97
 Total                                           330               1,244              5,448              0.44
Source: ONS (2009), Scottish Sea Fisheries Statistics 2008, p.10. [(1) £ million (2) thousands]

Approximately 65% of the distribution of the turnover of the Scottish processing industry is
based around Aberdeen. The processing industry is integral to the fishing-based economy. It
accounts for more jobs than the catching industry and aquaculture combined, with the added
significance that it provides employment for women in otherwise male-dominated labour
markets. The closure of a major processing plant can have a more serious impact on the
local community than the direct effects of decommissioning.129

Processing also creates the essential element of value-added production; without access to
local processing facilities, there is the risk that the local fleet would bypass the local
quayside market and land its catches elsewhere.

Two distinct sub-sectors make up the processing industry: the primary processors involved
in the filleting (and freezing) of fresh fish for onward distribution to fresh fish retail and
catering outlets or for further value added processing; and secondary processors producing
chilled, frozen and canned products for the retail/catering trades. Both of these sub sectors
are active in Angus.

Overall in Scotland employment in the fishing and fish processing sector fell by 16%
between 1999 and 2002. In Angus, over the same period, employment in the sector
declined by just over 8% (a reduction of 10 employees). In 2003 sea fish landings (mostly
shellfish) in Angus totalled £0.8 million and employed 58 fishermen. By 2004 this had
increased to £1.3 million, and employment had risen to 65 fishermen, or approximately
0.13% of the labour force.130 By 2008 (as shown in the table above) this had fallen to £1.2


129 Royal Society of Edinburgh (2004), Inquiry into The Future of the Scottish Fishing Industry, p. iii
130 ONS, Value of Sea Fish Landings into Scotland by Scottish Based Vessels; Fishermen Employed, by Region, 2004



                                                                                                                   67
million, and the number of fishermen had also decreased to 61, or 0.11% of the total
workforce.

                                                   MANUFACTURING

The secondary sector of industry is the manufacturing sector. This sector generally takes the
output of the primary sector and manufactures finished goods or products to a point where
they are suitable for use by other businesses, for export, or sale to domestic consumers. It is
often divided into light industry and heavy industry.131

The Scottish Government include the following sectors in their reports on Scottish
manufactured exports:

         chemicals, coke, refined petroleum & nuclear fuel;
         textiles, fur & leather;
         metals & metal products;
         engineering and allied industries;
         food, drink & tobacco;
         wood, paper, publishing & printing; and
         other manufacturing.

Scottish manufactured export sales in Q1 2010 grew by 0.2%, in terms of annual growth,
over the year to the end of March 2010, fell by 7.3%.132

This is a significant improvement on Q3 2009, which saw manufactured export sales grew by
0.1%, but fall by 12.1% over the year to the end of September 2009.133 The Q1 2010 results
were the first increase in Scotland's manufactured exports since Q1 2008.

In the period between Q1 1995 and Q4 2000 the index of manufactured exports exhibited a
period of strong growth (1.9% average quarterly growth) followed by a sustained decline
from Q4 2000 to Q4 2004 (2.7% average quarterly decline). Thereafter there was some
evidence of modest trend growth in export sales until the start of 2008. Over the five quarters
from Q2 2008 to Q2 2009 the volume of export sales declined, reaching their lowest level
since the start of the series.

The growth and decline in manufactured exports between 1995 and 2004 is largely
attributable to the electrical and instrument engineering sector, which grew by 95.7%
between 1995 and 2000 and fell by 66.1% between 2000 and 2004. This sector continues to
exert a heavy influence on the current changes in the volume of exports.134

Scotland's Global Connections 2008 Survey shows that Scottish international exports in
2008 (excluding oil and gas) are provisionally estimated at £20.7 billion, of which £14 billion
is attributable to the manufacturing sector. This represents an increase in overall exports of
£1.7 billion since 2007, due to a rise in the manufacturing sector exports of £935 million and
a rise in service sector exports of £715 million.135

There are a number of medium sized manufacturing and engineering companies based in
Angus, active in markets including steel, railstock, health product production, gear
manufacture and the manufacture of confectionary machinery. There are a number of


131 Wikipedia (2010), The Secondary sector of the economy
132 Scottish Government (2010< Scottish Export Statistics - Index of Manufactured Exports
133 Scottish Government (2010), Scottish Export Statistics - Index of Manufactured Exports
134 Scottish Government (2010), Index of Manufactured Exports Q3 2009
135 Scottish Government (2010), Scottish Export Statistics - Global Connections Survey



                                                                                             68
companies active in the oil and gas sector. The focus of these companies is no longer
restricted to the North Sea and is worldwide.

It is generally considered that the sector will continue to decline in Scotland as technology
advances in Asia and Eastern Europe in particular. To survive, companies will have to be at
the forefront of technology and be competing effectively in world markets.

Between 2006 and 2007 manufacturing jobs in Angus decreased by 2%, the national figure
decreased by 1%.136 The table below shows that only Perth and Kinross increased the
numbers employed in the manufacturing sector between 1998 and 2007.




136 Scottish Government (2009), Angus Economic Briefing



                                                                                           69
            Table 73: Manufacturing Employment Change in Scotland, 1998 - 2007

                           Number employed          Number employed     Difference   Difference
 Local Authority
                                1998                     2007             (No's)          (%)
Inverclyde                      6,100                    2,000            -4,100        -67.2
East Renfrewshire               2,000                     800             -1,200        -60.0
Clackmannanshire                3,600                    1,500            -2,100        -58.3
Eilean Siar                     1,300                     600              -700         -53.8
Edinburgh, City Of             24,200                   11,200           -13,000        -53.7
West Dunbartonshire             5,600                    2,600            -3,000        -53.6
North Ayrshire                 10,900                    5,800            -5,100        -46.8
Midlothian                      3,700                    2,000            -1,700        -45.9
Orkney Islands                   900                      500              -400         -44.4
East Lothian                    3,700                    2,100            -1,600        -43.2
Shetland Islands                1,400                     800              -600         -42.9
West Lothian                   18,400                   11,100            -7,300        -39.7
Fife                           28,500                   17,300           -11,200        -39.3
Renfrewshire                   16,900                   10,400            -6,500        -38.5
South Ayrshire                  8,900                    5,600            -3,300        -37.1
Dundee City                    11,800                    7,600            -4,200        -35.6
Falkirk                        14,200                    9,200            -5,000        -35.2
East Ayrshire                   7,400                    5,000            -2,400        -32.4
Scotland                      324,900                  220,200          -104,700        -32.2
South Lanarkshire              23,900                   16,800            -7,100        -29.7
North Lanarkshire              20,300                   14,600            -5,700        -28.1
Dumfries & Galloway            10,700                    7,900            -2,800        -26.2
Glasgow, City Of               31,100                   23,000            -8,100        -26.0
Scottish Borders                8,300                    6,200            -2,100        -25.3
Argyll & Bute                   2,000                    1,600             -400         -20.0
Angus                           6,600                    5,300            -1,300        -19.7
Aberdeen City                  15,600                   12,700            -2,900        -18.6
East Dunbartonshire             2,900                    2,700             -200          -6.9
Highland                        9,600                    9,000             -600          -6.3
Moray                           5,400                    5,200             -200          -3.7
Aberdeenshire                  12,000                   12,000               0            0.0
Stirling                        3,000                    3,000               0            0.0
Perth & Kinross                 3,900                    4,100              200           5.1
Source: Scottish Government (2009), Scottish Economic Statistics 2008


The following tables show key indicators for the manufacturing sector, in 2006 and 2007.




                                                                                              70
     Table 74: Change in the Manufacturing Sector in Angus and Scotland, 2006 – 2007

                                                            Angus                           Scotland
                                                     No               %              No                  %
 Total turnover (£m)                                34.7            5.42            965.9              2.55
 GVA at basic prices (£m)                            3.8            1.46             26                0.19
 Total labour costs (£m)                            26.7            20.54           105.5              1.69
 Total employees ('000s)                             0.3            6.00             -1.8           -0.81
 GVA / employee (£)                                 -199            -0.40            552               0.91
 Total labour costs / employee (£)                 5,220            21.48            666               2.36
Source: Scottish Government (2009), Scottish Economic Statistics 2008

In Angus, GVA per employee dropped, while the labour costs per employee increased. This
indicates that the sector was less profitable in 2007. However, Angus, unlike Scotland, saw
an increase in the number of employees. Also turnover increased by more than double the
national average. The details can be seen below.

                   Table 75: Manufacturing Sector - Key Indicators by LA, 2006

                                       GVA at        Total                                  Total
                        Total                                Total              GVA /
                                       Basic        Labour                              Labour Costs
Local Authority        Turnover                            Employees           Employee
                                       Prices       Costs                                / Employee
                         £m                                  '000s                £
                                        £m            £m                                     £
Scotland                 37,920        13,460       6,250           222          60,700           28,200
Aberdeenshire            1,850           610          310           12           49,900           25,600
Angus                      640           260          130            5           49,900           24,300
Dundee City                940           350          260            9           39,300           29,000
Perth & Kinross            500           150          90             4           37,000           21,500
Source: Office for National Statistics, Annual Business Inquiry (Compiled by Scottish Government 2008)

                   Table 76: Manufacturing Sector - Key Indicators by LA, 2007

                                       GVA at        Total                                  Total
                        Total                                Total              GVA /
                                       Basic        Labour                              Labour Costs
Local Authority        Turnover                            Employees           Employee
                                       Prices       Costs                                / Employee
                         £m                                  '000s                £
                                        £m            £m                                     £
Scotland               38,885.9       13,486.0     6,355.5        220.2          61,252           28,866
Aberdeenshire           1,965.9         714.3       338.3           12.0         59,479           28,172
Angus                    674.7          263.8       156.7           5.3          49,701           29,520
Dundee City             1,015.2         417.2       290.7           7.6          54,593           38,033
Perth & Kinross          508.8          175.8        96.7           4.1          43,378           23,849
Source: Office for National Statistics, Annual Business Inquiry (Compiled by Scottish Government 2009)




                                                                                                              71
           Table 77: Manufacturing Sector in Angus - Key Indicators from 1998 – 2007

                                                  GVA at Total
     No   Total    Total                                         GVA / Gross Wages Total labour
                                                   Basic Labour
Year of Employees Turnover                                      Employee & Salaries / Costs /
                                                  Prices Costs
    Units ‘000s     £m                                              £    Employee £ Employee £
                                                    £m     £m
1998 267               6.6           544.6        215.0   117.9  32,404    15,765     17,772
1999 276               7.1           619.0         249.2        147.2        34,929           18,368             20,629
2000 270               7.0           601.6         218.2        146.0        31,246           18,620             20,897
2001 258               5.4           521.8         201.8        122.6        37,201           20,234             22,596
2002 258               5.1           497.4         146.9        103.2        28,683           17,934             20,142
2003 255               6.0           661.5         270.3        128.1        44,715           18,695             21,196
2004 254               6.2           632.9         243.3        134.8        39,393           19,005             21,820
2005 256               5.3           577.6         234.9        129.1        44,325           20,775             24,365
2006 258               5.3           643.0         258.0        134.4        48,590           21,792             25,319
2007 267               5.3           674.7         263.8        156.7        49,701           25,384             29,520
Source: Office for National Statistics, Annual Business Inquiry (Compiled by Scottish Government 2009)

                                                TEXTILES & CLOTHING

The textile sector in Scotland has radically altered, with the number of companies and
employees dramatically decreasing in line with overall UK manufacturing and a progression
towards a more flexible, innovative and market driven industry. It remains an important
contributor to Scotland’s economy, with annual turnover of £967 million and over 655
companies directly employing 10,200 people.137

In 2006 in Scotland, there were 450 companies in total, employing 17,000 people. Ninety
per cent of these companies were Scottish-owned, while the majority of those that were
foreign-owned continued to have their decision makers based in Scotland. Forty per cent of
companies increased turnover in 2006, rising to a total of £1,084 million. A further 32% of the
companies indicated that their turnover remained static. Forty per cent of the companies
exported overseas, with the USA as the biggest export market, followed by France,
Germany, Italy and Japan.138 The table below shows the total value of textile products
exported between 2004 and 2008. Although there are some fluctuations, the figures
increased for the manufacture of textiles and textile products, but declined for the
manufacture of wearing apparel; and dressing and dyeing of fur.

                       Table 78: Total exports by industry (£million), 2004 – 2008

                                                                2004         2005          2006         2007         2008
 Manufacture of Textiles & textile Products                      270          265           275          255         300
 Manufacture of Wearing Apparel;
                                                                  45           35           30            35         30
 Dressing & Dyeing of Fur
Source: Scottish Government (2009), Global Connections Survey 2008




137 Scottish Government (2009),Consultation on the Energy Efficiency Action Plan for Scotland, p.100
138 Ecotec (2007), Scottish Textiles Industry Survey 2007 - A report to Scottish Enterprise National Textiles Team



                                                                                                                            72
Scottish manufactured export sales grew by 0.1% in real terms in Q3 2009 and fell by 12.1%
over the year to the end of September 2009. Growth in textiles, fur and leather exports were
reported (+14.1%). The breakdown of this can be seen below.

Table 79: Quarterly Index of Scottish Manufactured Exports, in Constant prices, (2004=100)

                                                         Total Manufacturing           Textiles, Fur & Leather
 2004                                                           100.0                           100.0
 2005                                                           102.7                            91.9
 2006                                                           106.9                            96.0
 2007                                                           111.0                            94.7
 2008                                                           108.3                            87.4
 % Growth, latest Q on previous Q                                 0.1%                            14.1%
 % Growth, latest 4Qs on previous 4Qs                            -12.1%                          -19.0%
Source: Scottish Government (2010), Index of Manufactured Exports 2009 Q3

The 19.1% decline in the industry in the year to date has been mirrored in a decline in the
number of people employed in the sector. The number of people employed in the industry in
Scotland has more than halved in the space of a decade. Employment decreased from
19,100 in 1997 to just 7,500 in 2007.139 Despite a rapid decline of 35% since 1999, the
Dundee City Region retains a high level of specialisation within the industry. Total
employment in the sector was around double the national average in 2007, although it
should be noted that it accounts for just 1% of all jobs in the region.140

Information extracted from the Business Establishment Records Angus (BERA) shows that
employment in the textile industry in Angus was 990 in 2001, falling to 774 in 2006, and to
763 by 2008.141 This is a drop of 23% between 2001 and 2008, which would suggest that
the industry in Angus is perhaps performing slightly better than nationally. However,
because it is based on a small number of companies, particularly 2 large employers, it is
vulnerable to the possible impacts of a factory closure, which could have a devastating
impact not only on the textile industry in Angus, but the local economy as a whole.

Within Angus, the sector is dominated by two companies, which between them provide over
83% of the employment (in 2008). In 2001 they accounted for 91.8% of employment, with
this figure falling to 84.6% in 2006. Both are engaged in the manufacture of ‘technical
textiles’, which in 2003 was described as, ‘the most rapidly growing sector in the textiles
industry, currently developing at a rate of 5% per annum’.142 However, it is an extremely
competitive market and the narrowness of the employment base within the sector must be of
concern.

What is of interest is that the drop in these companies domination of the local industry sector
has been accompanied by a rise in the number of companies operating in Angus. This has
increased from 11 companies in 2001 to 17 companies in 2006, to 19 companies in 2008.
However the new companies tend to be micro-companies or cottage industry type ventures,
taking advantage of e-commerce for the sole trader. However, it also suggests that there
have been some spin off ventures (one in specific attributable to one of the main
companies). The ability of small companies to strategically place themselves to service
niche markets is fundamental to an economy which is dependent on SMEs for employment.



139 BBC (13.05.2009), “Textile job decline 'devastating'”
140 Slims & Oxford Economics (2009), Scottish Enterprise Dundee City Region – Economic Review 2009, p. 50
141 Angus Council (2008), Business Establishment Register Angus
142 Scotland.org (2003), Cloth of Gold.



                                                                                                                 73
                                        CHEMICALS & PHARMACEUTICALS

Many of Scotland’s industries, including life sciences, electronics, chemicals, food and drink
and energy, have chemical sciences at their core. The chemicals industry is one of
Scotland’s top export earners, generating around £1.3 billion of manufacturing exports from
a revenue stream worth almost £3.5 billion. It is also one of the highest value industries,
providing employment for almost 14,000 people directly and nearly 70,000 indirectly. Wages
and productivity in the chemicals industry are high; salaries average £27,500 per annum and
GVA per employee is £76,000, 44% higher than general manufacturing. The industry
comprises more than 120 businesses across Scotland, 85% of which are considered to be
SMEs.143

The main manufacturing activities in this sector of the industry in Scotland concern basic
pharmaceutical products and pharmaceutical preparations. Pharmaceuticals are the second
largest sector of the Scottish chemicals industry, contributing 32% of its GVA.

The main employer in the sector in Angus is GlaxoSmithKline. Its factory in Montrose is the
only one in the world licensed to manufacture the anti-flu drug Zanamivir and is due to
double output in response to soaring global demand. Zanamivir is the active pharmaceutical
ingredient for GSK’s anti-viral flu product, the Relenza disc inhaler, currently being stockpiled
by health agencies around the world as a swine flu treatment. To meet increased demand
and boost strategic stocks, GSK has invested £5 million at Montrose to double its production
capacity to 24 tonnes.

It takes total investment at the site to over £40 million in the past 4 years, and the workforce
has also increased to over 400. Of these, 280 are full-time, with the remainder being
employed as contractors. This includes 30 contractors brought in specifically to support the
Zanamivir campaign.

The company is aiming to boost production of the drug to 190 million doses by the end of
2009, 10.6 million of these bound for UK health agencies. The demand for Relenza, in a
form which also includes an injection for the most seriously ill, saw sales jump to £60 million
between April and June 2009. That compares with just £3 million a year earlier. Typical
demand for Zanamivir is less than 0.5 tonnes a year but 15 tonnes could be required over
the next year, and production lines in Montrose are set to work continuously until September
2010.144

This is a major change in the situation with GSK. Since the 2000 merger between Glaxo
Wellcome and SmithKline Beecham created one of the world’s largest pharmaceutical
companies there have been fears for jobs and for the future of the plant at Montrose, as a
result of ongoing redundancies, and the 2001 announcement that the plant was to be placed
on the market, and hopefully sold as a going concern. In 2003, a Dutch company days away
from concluding a deal pulled out of the negotiations. In October 2004 it was announced
that the plant would be closed in 2006, with the loss of the remaining 300 jobs.145 However
in April 2006, GSK announced that the plant had been saved from closure and announced
£25 million was to be invested in the site and a workforce of 250 staff was to be retained.

The 2006 closure deadline was revised because the site manufactures the active ingredient
of drugs used to fight bird flu. The recent swine flu pandemic has led to further investment
and employment at the site.



143 Chemical Sciences Scotland (2007), The Formula for Success - A strategic plan for the Chemical Sciences in Scotland, p.3
144 D C Thomson & Co Ltd, The Courier (11.11.2009), ‘Montrose role in swine flu battle hailed’
145 D C Thomson & Co Ltd, The Courier (08.10.2004), ‘Body blow for Montrose workforce’



                                                                                                                         74
The short case study of GSK above shows the dangers of a local economy being reliant on
large multi national companies, where decision makers are not based at a local or even
national level. A study was commissioned to examine the impacts of the possible closure of
the factory on Montrose, and Angus, and it estimated that approximately 14% of the total
employment level in Montrose in 2003 would be lost. It also estimated that Montrose would
lose £6.96m of income due to the leaks that occur from the Montrose economy.146

                                      BIOTECHNOLOGY AND LIFE SCIENCES

Scottish Enterprise defines biotechnology as ‘the application of scientific and engineering
principles to the processing of materials by biological agents’. Life Sciences can be defined
as any of the branches of science concerned with the structure and behaviour of living
organisms.

Scotland hosts one of the most sizeable life sciences clusters in Europe, with a significant
multinational presence in research, development and manufacturing. Twenty new life
science companies started trading in 2007, while the increasing numbers of corporate spin
outs demonstrate the maturing of the sector in Scotland.147 More than 600 life sciences
organisations operate in Scotland employing over 30,500 staff. The sector has experienced
annual GVA growth rates of 7-8%, four times the medium term average growth rate of the
Scottish economy.148

Scotland is the base for 20% of the UK’s life science companies, with over 25,000 people
employed. Dundee has become a recognised centre for biotechnology and life sciences with
much of the activity centring on the research and development activity being undertaken by
its two universities and Ninewells Hospital. Over 4,000 people now work in Dundee's life
sciences sector - this accounts for 16% of the local economy and is forecast to grow at 10%
per annum over the next 3 years.149 To date Angus has had little success in achieving spin
off from the development of this cluster.

However, there are some Angus companies operational in this sector including Interplex
PMP, based in Arbroath, who manufacture a range of metal stampings, injection mouldings,
insert mouldings for many industries, including medical. Grain & Seed Analysis, based in
Forfar, is the only UKAS accredited, totally independent laboratory in Scotland, licensed for
testing barley, wheat, and oats for certification purposes. Point of Care Testing, based in
Arbroath, is a supplier of key point of care and laboratory products, and of analytical services
for analysis of samples for the National Independent Bowel Cancer Screening Programme.
AGR Automation Ltd, in Arbroath, are experienced in the assembly of medical devices from
bench top tooling, for initial build of products for trials, through to fully automatic assembly
lines.      Medical Instrumentation (UK) Ltd, based in Carnoustie, offers a range of
technological services, specialising in endoscopic instruments. 150

GSK could also fall into this sector, and according to the Scottish Life Sciences Strategy
2008 represents the most considerable investment of any pharmaceutical company into
Scotland. GSK employs 1,200 people in Scotland and made significant investments into both
of their Scottish sites in 2007. The Montrose site, which manufactures medicines used to
combat flu, diabetes and respiratory disease, received a capital investment of £25 million in
2007.



146 DTZ Pieda Consulting (2006), Montrose Economic Study, p. ii
147 Scottish Enterprise (2007), The Life Sciences Industry in Scotland
148 ONS Statistics 2005, as cited in Life Sciences Scotland (2008), Scottish Life Sciences Strategy 2008, p.6
149 BioDundee (2008), About BioDundee
150 BioDundee (2008), Company Directory



                                                                                                                75
                                                    FOOD & DRINK

Scotland's food and drink industry generates over £9.5 billion annually for the Scottish
economy and the food and drink supply chain employs over 360,000 people.151 Food and
drink accounted for over a quarter of Scotland's manufacturing exports in 2007. Scottish
food and drink manufacturing outperforms the industry in the UK as a whole. Over the year
to Q3 2008 output in Scotland increased by 3.1%, whereas for the UK it fell by 1.8%.152
Some key facts on the Scottish food and drink industry are listed below.

         The supply chain has over 75,000 food and drink businesses and is dominated by
          micro businesses (1-10 employees).
         Overseas food and drink exports from Scotland are worth £5 billion a year.
         Whisky is the top exporter for Scotland.
         Overseas food exports are £800 million a year while food imports from overseas are
          £900 million a year.
         Fish and shellfish make up the largest proportion (55%) of food exported overseas.
         Scotland's primary producers supply 25% of all raw materials for Scottish food and
          drink manufacturing.
         Between May 2007 and May 2009, retail sales of Scottish brands within GB have
          increased by £0.3 billion, constituting a 21% rise. Sales of Scottish brands in
          Scotland increased by £76 million, an 18% rise.
         Scotch Beef was the top selling Scottish brand in both GB and Scotland. Retailer
          sales of Scotch beef increased by 12% in GB and 22% in Scotland.
         Scotch Lamb sales increased by 25% in GB and 18% in Scotland.
         Scottish food exports outside the UK in Q1 2009 were 16% higher than in Q1
          2007.153

The following table shows the importance of food and drink manufacturing to the economy
between 2002 and 2007. However, it does show that employment in the sector has fallen.

                   Table 80: Trends in Food and Drink Manufacturing, 2002 – 2007

                                                                                                F & D manufacturing
                      2002         2003         2004        2005        2006         2007        as a % of Scottish
                                                                                                   manufacturing

 GVA (£bn)              2.1         2.4          2.7         2.9          3.0         N/A           22.3%
                                                                                                             2006
 Sales (£bn)            6.4         6.9          7.6         7.7          7.4         N/A           19.5%
 Exports*
                       405          395          400         410         395          435           3.2%
 (Food) (£m)
 Exports*
                        2.4         2.5          2.6         3.1          3.5         4.3           31.3%    2007
 (drinks) (£m)
 Employment          51,466       50,377       48,690 47,800 45,670 46,016                          20.8%
*Excludes exports to the rest of the UK
Source: Scottish Government (2009), Food and Drink in Scotland – Key Facts, p.9

The table below illustrates the different interpretations of how the food and drink sector can
be defined, and the statistics for each.


151 Scottish Government (2009), Recipe for Success - Scotland's National Food and Drink Policy, p. iv
152 Scottish Government (27.02.09), ‘£1.4 million for food industry’.
153 Scottish Government (2009), Recipe for Success - Scotland's National Food and Drink Policy, p. 5



                                                                                                                  76
                     Table 81: Key Statistics by Different Definitions of Food and Drink

                                                     Food and Drink          Food and Drink           Food and Drink
                                                      Key Sector154            Industry155            Supply Chain156
  GVA (2006)                                            £3.9 bn                  £8.5 bn                 £9.5 bn
  Sales (2006)                                           £9.8 bn                 £27.3 bn**               £29.6 bn**
  Employment* (2007)                                    117,826                   290,359                     362,169
  Exports*** (2007)                                      £4.8 bn                   £4.9 bn                     £5.0 bn
  No of business units (2007)                            54,503                    22,230                      75,530
 * Employment figures for agriculture comprise working occupiers, working spouses of occupiers and
 employees. ** Includes double counting. *** Exports exclude those to the rest of the UK.
 Source: Scottish Government (2009), Recipe for Success - Scotland's National Food and Drink Policy

 Production performance in the food and drink sector, as measured by the quarterly GDP
 Index, has fluctuated over time. However, output is currently 6.4% greater than it was in the
 same quarter a decade ago.157 The most recent GDP data (Q3 2009) shows that food, drink
 and tobacco (including agriculture and fishing) experienced an increase of 3.7% in the last
 quarter, but a decline of 3.4% in year on year terms.158

 Employment in the food and drink sector decreased substantially in 2007/08, falling by
 10.6% (as shown in table 80 above). This was driven by retailing and non residential
 catering, which have both seen an increase in employment since 1998. This is shown in the
 figure below.

          Figure 21: Employment in the Food and Drink Industry in Scotland, 1998-2007
                       350,000

                       300,000

                       250,000

                       200,000

                       150,000

                       100,000

                        50,000

                            0
                                   1998     1999      2000      2001     2002      2003      2004      2005       2006      2007
       Manufacturing              55,959   56,858     55,432   53,088   51,466    50,337    48,690    47,800     45,670    46,016
       Wholesaling                20,256   21,440     19,508   20,759   19,614    19,721    19,386    20,429     20,086    18,845
       Retailing                  98,501   100,899    98,404   119,333 121,513   112,600   114,461 111,154       103,526   107,250
       Non Residential Catering   105,141 103,243    114,511 116,814 118,152     115,329   119,744 120,292       120,731   118,248
       Total                      279,857 282,440    287,855 309,994 310,745     297,987   302,281 299,675       290,013   290,359
Source: Scottish Government (2009), Food and Drink in Scotland: Key Facts 2009


 154 Food and Drink Industry - Food and Drink Manufacturing; Food and Drink Wholesaling; Food and Drink Retailing; Non
 Residential Catering (as defined in the Scottish Government’s Recipe For Success - Scotland's National Food and Drink Policy)
 155 Food and Drink Key sector - Food and Drink Manufacturing plus Agriculture, Sea Fishing and Aquaculture
 156 Food and Drink Supply Chain - Food and Drink Industry plus Agriculture, Sea Fishing and Aquaculture
 157 Scottish Government (2009), Scottish Economic Statistics 2008, p.78
 158 Scottish Government (2010), Gross Domestic Product for Scotland, Q3 2009



                                                                                                                             77
Gross weekly pay (full time jobs) in the food and drink sector stood at £377.40 in 2007. This
compares poorly to an average weekly wage of £441.50 in the wider Scottish economy. The
food and drink manufacturing sub-sector paid slightly better than the agriculture sub-sector
with a weekly wage of £378.80 compared to £365.50.

Manufacturing exports were estimated at £14 billion (68% of total exports). The figures for
2009 show a 20% rise in food products to £934 million, while combined total international
sales for Scottish food and drink increased by 6% to an all time high of £4.06 billion.
Seafood exports led the way, with international sales in this sector increasing by 20% to
£555 million, assisted by overseas demand for Scottish salmon (fresh, frozen and smoked),
which enjoyed total export sales valued at £285 million. Scotch whisky exports grew by 3%
in value to £3.13 billion. This is a rise of over £270 million since 2007.159

In Angus, the food and drink sector is well represented, with several well known companies
operating in the county. The traditional Arbroath Smokie, Forfar Bridie and Aberdeen Angus
beef have been joined by frozen foods, microwave meals, sea and river fish, spring water
and soft drinks manufacturing. Whisky distilling is also a feature of Angus' food and drink
industry with Glencadam Distillery in Brechin bottling Glencadam Highland malt
commercially for the first time in 2005. Companies such as Strathmore Water, R R Spink
and Strathmore Foods have been actively investing in recent years and have increased their
market share.

Employment in Angus is estimated at more than 5,300. This is based on those employed in
the agriculture and fisheries sector, food & drink processing, retail & wholesale, hotels,
restaurants & cafes, and vending machine supplies & services.160

In 2004, the European Commission granted Arbroath Smokies Protected Geographic
Indication (PGI) status. This means only haddock smoked in the traditional method within
8km of Arbroath can be sold as an authentic Arbroath Smokie. This led to the creation of at
least 14 new jobs.161

In March 2008 the Scottish Government launched the Food Processing Marketing and Co-
Operation Scheme. The scheme is part of SRDP and will run until 2013. The scheme covers
agricultural produce only. To date the Scheme has made the following awards in Angus.
Total investment in the projects below amounts to £15,173,954, with the grant awards
totalling £3,330,782.




159 Scottish Government (2010), Global Connections Survey 2008.
160 Angus Council (2008), Business Establishment Register Angus.
161 Angus Council (2008), Business Establishment Register Angus.



                                                                                           78
Table 82: Angus Awards from the Food Processing Marketing & Co-operation Grant Scheme

Date Company                                Description                                         Project Costs    Award
Aug North Street           Purchase of a cream separator & butter
                                                                                                  £12,547        £5,018
2008 Dairy, Forfar         churn.
     Angus
Nov                        Construction of Scotland's first combined
     Cereals Ltd,                                                                               £11,809,250 £2,262,351
2008                       cereal crop processing centre.
     Montrose
     Strathmore
Feb                        Upgrade of buildings, plant & equipment to
     Foods,                                                                                      £425,000       £148,750
2009                       develop new chilled & convenience dishes.
     Forfar
                  The purchase of 6 heat sealing units, the
     Angus Soft
June              installation of a new packing line & the
     Fruits,                                                                                     £954,232       £189,046
2009              purchase of refrigeration equipment over
     Arbroath
                  several sites.
                  Construction of a new, purpose built
     Stirling
                  packhouse. Purchase & installation of a
     Potatoes,                                                                                   £1,093,444     £437,372
                  range of grading, dicing, slicing, packing &
     Angus
                  handling equipment.
     AP Jess      Upgrade of facility & installation of an
July
     (Brechin)    automated lamb processing line &                                               £635,463       £190,638
2009
     Ltd, Brechin computerised Carcass Classification System.
     R&N
                  Purchase & installation of a new beetroot
     Cessford,                                                                                   £216,808       £86,723
                  processing line.
     Farnell
                                                                                                £15,173,954 £3,330,782
Source: Scottish Government (2008-09), Awards from the Food Processing Marketing & Co-operation Grant
Scheme

                                                      CONSTRUCTION

The construction sector as defined by ConstructionSkills, the sector skills council, includes
the following subsectors:

    Architectural and engineering activities                          Construction of highways, roads, airfields
     and related technical consultancy                                  and sports facilities
    Construction of water projects                                    Demolition and wrecking of buildings

    Earth moving                                                      Erection of roof covering and frames
                                                                       General construction of buildings and
    Floor or wall covering
                                                                        civil engineering works
    Insulation work activities                                        Joinery installation
    Renting of construction or demolition                             Other construction work involving special
     equipment with operator                                            trades
    Painting and glazing                                              Plastering

    Other building completion or installation                         Test drilling and boring162




162 Alliance of Sector Skills Council (2008), Construction, Scottish Sector Profile 2009, p.3



                                                                                                                          79
Turnover in the Scottish construction sector increased by 59% between 2000 and 2007
(from £9.8 billion to £15.6 billion). In the same period, Scottish construction GVA increased
by 65% (from £3.9 billion to £6.4 billion) 163

Between 2010 and 2014, total construction output in Scotland is forecast to increase at an
annual rate of 2.8%, higher than the UK’s rate of 1.7%. New work output is expected to see
stronger growth than repair and maintenance, which is likely to see the new work sector
continue to remain relatively more important in the nation than it is in the UK as a whole.
Employment is expected to increase to around 257,000 in 2014, 1.2% above 2008’s level.164

The recent economic downturn has had a significant impact on the housing market. It is too
soon to have quantifiable evidence of the impact on the construction sector, but it is
inconceivable that when statistics do become available, they do not report a fall in
employment or output.

Employment within the construction sector tends to be variable. In Scotland there was an
increase from 189,700 employees in 2004/5 to 210,000 in 2008/9 (+10.7%). In Angus the
numbers increased from 1,745 in 2004/5 to 2,100 in 2008/9 – an increase of 20.3%.
However during that period there were significant fluctuations. This can be seen below.

    Figure 22: Number of Employees in the Construction Industry in Angus – 1995 - 2008
 3,000

 2,500

 2,000

 1,500

 1,000

   500

     0
         1995


                1996


                         1997


                                  1998


                                           1999


                                                    2000


                                                             2001


                                                                      2002


                                                                               2003


                                                                                        2004


                                                                                                 2005


                                                                                                          2006


                                                                                                                 2007


                                                                                                                             2008


Source: Nomis (2009), Annual Business Inquiry (compiled by the Scottish Government)

In general, construction sector companies in Angus are small (up to 100 employees) and
have a regional or local market. For major contracts their aspiration will tend towards sub-
contracting rather than acting as lead contractor. As such, continuity of work can be an
issue when little construction is taking place locally. Availability of skilled employees is a
major issue for such companies given the variable nature of the market. The tendency
towards centralised procurement in respect of public sector contracts is also of concern.

The table below shows that GVA per employee in Angus is significantly above the Scottish
level, however, gross wages and salaries, and total labour costs per employee and both the
lowest out of the areas compared.



163 Scottish Government (2009), Profile of Scottish Construction Sector (SIC45)
164 Construction Skills, (2010), Construction Skills Network Scotland 2010-1014, Labour Market Overview, p.2



                                                                                                                        80
                            Table 83: Summary of the Construction Sector, 2007

                                        Total            Total                          Gross Wages &
                         No. of                                   GVA /                                 Total labour Costs
                                      Employees        Turnover                            Salaries /
                         Units165                               Employee (£)                             / Employee (£)
                                       (000’s)           (£m)                            Employee (£)
Scotland                 16,305          127.3        15,574.3         50,061               23,647          26,598
Aberdeenshire            1,210            6.8           940.1          65,874               24,054          26,727
Angus                      410            2.2           238.6          57,571               19,618          21,772
Dundee City                317            3.4           383.4          51,805               20,403          22,838
Perth & Kinross            620            4.3           600.6          61,669               24,339          27,316
Source: Scottish Government (2009), Profile of Scottish Construction Sector (SIC45)

                                                      ENERGY SECTOR

The energy sector includes all of the industries involved the production and sale of energy,
including fuel extraction, manufacturing, refining and distribution. In particular, the energy
sector comprises:

         the petroleum industry, including oil companies, petroleum refiners, fuel transport and
          end-user sales;
         the gas industry, including natural gas extraction, coal gas manufacture, and
          distribution & sales;
         the electrical power industry, including electricity generation, electric power
          distribution and sales;
         the coal industry;
         the nuclear power industry; and
         the renewable energy industry, comprising alternative energy and sustainable energy
          companies, those involved in hydroelectric power, wind power, and solar power
          generation, and the manufacture, distribution and sale of alternative fuels.166

Energy is vital to keeping Scotland's businesses, hospitals and schools running; heating
homes; and transporting goods and people. Producing energy from non-carbon emitting
sources and reducing emissions are central to climate change commitments. The energy
sector is vital to Scotland's economy, both in terms of current production, supply and
consumption and also through the future opportunities that will arise from Scotland's
comparative advantages in respect of the transformation in energy technology and systems
that are required to meet the world wide climate change and energy security challenges.167

Energy is a sector in which Scotland has considerable comparative advantages. It is a key
sector in the Government Economic Strategy (GES), with sustainable energy development
contributing to commitments to reduce carbon emissions and to promote sustainable
economic growth. There are clear growth opportunities from improving the environment and
moving towards a low carbon economy. Scotland has a comparative advantage in
alternative energy technologies, with a quarter of Europe's wind potential and vast
renewable reserves. Scotland is estimated to have 25% of Europe's offshore wind resource,
10% of Europe's wave resource and 25% of its tidal resource.




165 No of Units relates to the number of individual business sites e.g. a plant, factory, shop etc.
166 Wikipedia (2009), The Energy Sector
167 Scottish Government (2009), Energy - Taking forward our National Conversation, Part 4



                                                                                                                        81
The Climate Change (Scotland) Act 2009 introduced statutory targets to reduce greenhouse
gas emissions by 80% by 2050. The Scottish Government’s performance framework
supports these with a commitment that 50% of Scottish electricity gross consumption will
come from renewable sources by 2020, with an interim target of 31% by 2011. The
Government also propose that 20% of all energy use (not just electricity) should come from
renewable sources by 2020, in line with EU wide targets, and above the UK target of 15%. It
also intends to work towards the decarbonisation of the electricity generation sector by
2030.168

The GES specifically highlights the current importance of the oil and gas sector to Scotland’s
economy and in particular the development of the supply-chain focusing upon high-value,
internationally-orientated activities.

Direct employment in the Scottish energy sector (excluding renewables) rose 10% between
2006 and 2007 to 40,700, and represents 23% of the GB energy sector. However this is only
a fraction of total employment generated by the sector in Scotland, which is over 200,000.
                                                                                  169
Scotland exported an average of 17% of its electricity between 2000 and 2007.         It is
estimated that there are at least 4,000 to 6,000 renewables jobs in Scotland, with the
potential to support at least 16,000 new jobs over the next decade. Scotland now has more
than 3 gigawatts (GW) of installed renewables capacity, enough to power 1.5 million homes
with clean, green energy.

Adding potential energy from approved renewable projects to those already operating would
bring the total to over 6GW - in excess of the 31% target by 2011. An estimated 21.5GW of
commercial wave and tidal capacity could be harnessed from the waters around Scotland. In
February 2009 the Crown Estate awarded 10 ‘exclusivity agreements’ to 10 offshore wind
sites in Scottish Territorial Waters, with the potential to generate a further 6.4GW of
electricity.

North Sea oil was discovered in 1967, and first produced in 1975. The North Sea contains
Western Europe's largest oil and natural gas reserves and Aberdeen is the world's second
largest energy hub, behind Houston. It has been estimated that the oil and gas industry
accounts for around 120,000 direct and indirect jobs in Scotland from activity in the UK
Continental Shelf, with a further 75,000 being supported through induced employment and
export activities.170

In Angus, there are several companies which operate in this sub sector. These include
multinational companies like Halliburton, VetcoGray, National Oilwell Varco and Weatherford
UK, and local companies such as Merpro, Ladco Advanced Engineering, Pioneer Oil Tools,
and MacDonald Energy Consultants. Analysis of BERA shows that in 2008, this sub sector
employed over 2,000 staff in Angus.

Fossil fuels are a finite source. There is concern that they will run out before the end of the
century. However, renewable energy sources, and new technologies will be able to reduce
our current dependence. New technologies such as carbon capture and storage (CCS) will
become increasingly important.

Scotland's CO2 Storage Research Study in 2009 estimated that Scotland has significant
CCS potential. The North Sea has the potential to store over 200 years of Scotland's
emissions and preliminary studies suggest that Scotland's offshore CO2 storage capacity is
comparable with that of offshore Norway, and greater than the Netherlands, Denmark and


168 Scottish Centre for Carbon Storage (2008), ‘What is Carbon Capture and Storage (CCS)?’
169 Scottish Government (2009), Economic Benefits of Energy
170 Scottish Government (2009), Energy - Taking Forward Our National Conversation, Part 4



                                                                                             82
Germany combined. This could potentially generate revenue from storage of several billion
pounds per annum. 171

Briefly, CCS works as follows. Carbon is emitted into the atmosphere (as CO2) whenever
fossil fuel is burnt. To prevent CO2 building up in the atmosphere, it is possible to catch and
store it. This must be done using natural storage facilities. Some of the best natural
containers are old, empty oil and gas fields, such as those in the North Sea.172 It is
estimated that approximately 10,000 jobs could be created with the development and
deployment of clean fossil fuels and carbon capture and storage. Clean fossil fuels refers to
the capture of the CO2 emitted, reducing environmental impact. Research indicates that
CCS has the potential to reduce CO2 emissions by up to 90% from conventional fossil fuel
power stations.

The Scottish Government’s Electricity Networks Strategy Group assumes that there will be
11.4GW of installed capacity renewable energy in Scotland by 2020 (over 60% of domestic
consumption). In addition, around 4-6 GW would be exported to England by sub sea cables.
By 2030 as the full potential of offshore wind and marine and tidal technology is realised,
there could be as much as 25GW of installed renewable energy capacity, allowing
substantial exports to England and the Continent through proposed North Sea grid
connections.

It is estimated that wave and tidal power around Scotland could generate another 1GW by
2020, sustaining 2,600 direct jobs in Scotland, with an associated investment of £1.3 billion
in marine renewables being retained. Related employment could potentially rise to more
than 12,000 across Scotland if indirect and induced jobs are taken into account.173

Currently, the Scottish Government's Energy Consents and Deployment Unit is processing
36 applications (24 onshore wind, 11 hydro and 1 thermal), amounting to 2.7GW. In addition
to this, in 2010 the Scottish Government announced that its plans to upgrade the Beauly to
Denny power line have been approved. The upgrade will boost grid capacity along the line
and unlock Scotland's onshore and offshore renewables potential.174

It can be seen that there are significant opportunities for future sustainable economic
development in the energy sector. Although the vast majority of information presented
above is based on Scotland wide statistics and research, Angus is well placed to take
advantage of developments. It is geographically close to the North Sea Oil fields, and has a
large number of companies currently engaged in the sector, and subsequently a highly
skilled staff base.

                                               SERVICE SECTOR

The service sector refers to the part of the economy that includes individuals and businesses
that produce services rather than goods. This includes education, finance, communications,
legal services, utilities, wholesale and retail trade, and transportation. The following table
shows the key statistics for the services sector in Angus, its neighbouring LAs, and Scotland.
It can be seen that the GVA per employee in Angus is higher than the national average.




171 Scottish Government (2009), Energy - Taking forward our National Conversation, Part 4
172 Scottish Centre for Carbon Storage (2008).’ What is Carbon Capture and Storage (CCS)?’
173 Forum for Renewable Energy Development in Scotland Marine Energy Group (2009), Marine Energy Group's Roadmap
174 Scottish Government (2010), Beauly - Denny upgrade approved



                                                                                                                   83
                        Table 84: Service Sector1 - Key Indicators by LA, 2007

                                            GVA at         Total                                            Total
                             Total                                 Total
                                             Basic        Labour             GVA /                         Labour
                            Turnover                             Employees
                                            Prices        Costs            Employee                        Costs
                              £m                                   '000s
                                              £m            £m                                          / Employee
Scotland                     109,266        36,759        24,394  1,247.9   £29,458                       £19,549
Aberdeenshire                 5,051          1,939           883          41.1          £47,206           £21,500
Angus                         1,482           488            278          16.1          £30,234           £17,194
Dundee City                     249            68            46              3.9        £17,447           £11,723
Perth & Kinross               1,915           614            378          25.7          £23,847           £14,691
Source: Office for National Statistics (2009), Annual Business Inquiry (Compiled by Scottish Government)
1. Service sector coverage excludes certain areas such as the financial sector and some of the public sector.

Compared to Scotland, Angus has a lower level of jobs in the sector. This can be seen
below. The only sub sector where Angus is over represented is in retail, wholesale and
hotels. The area where the discrepancy is most significant is in finance and business
services.

                             Table 85: Service Sector – Angus and Scotland

                                                             Angus                              Scotland
                                                  No (‘000s)             %            No (‘000s)              %
 Service Sector Total                                 25.8              71              1967.5                82
   Retail, wholesale and hotels                        8.6              24               528.7                22
   Transport and communications                        1.3               4               130.3                 5
   Finance and Business                                3.2               9               451.5                19
   ‘Other Services’¥                                  12.8              35               856.9                36
¥ Other services includes Public Administration, Education, Health and Other Services
Source: Scottish Government (2009), Angus Economic Briefing.

The number of jobs in the sector has increased slightly between 1999 and 2005, and 2006
and 2007, however the imbalance has worsened. The following sections address some of
the key sub industries of the service sector.

                                                      TOURISM

Scotland, according to the World Tourism Organisation (WTO), has a share of just 0.23% of
all international arrivals worldwide. This accounts for total tourism revenue for Scotland of
£4.2 billion, which is larger than the oil, fishing and whisky industries combined.175

The tourism sector is typically defined as separate service industries covering business such
as travel agencies, hotels, camping sites, youth hostels, other lodgings, restaurants, bars,
museums, sporting activities, tour operators and fair & amusement park activities.

The UK is Scotland’s largest market and accounts for 83% of total visitors, and 67% of total
tourism expenditure in Scotland. Over the last few years, this market has seen a slight
decline, but due to the current economic downturn and its impact on global tourism, these


175 Tourism Intelligence Scotland, Series 3: Knowing our Markets...Scotland's Visitors, p.10. Available from www.tourism-
intelligence.co.uk/guides.aspx



                                                                                                                      84
trends have been reversed. With the volatility of the economic market in 2008, it is
impossible to use the experience of the year as a benchmark for going forward. 176 Due to
the recent economic decline, it is difficult to use the most recent figures published (the
figures presented below), as a benchmark against other figures.

Forecasters predicted that in 2009, it was unlikely that there would be any reliable trends
emerging from the statistics on which to base future assumptions due to multiple fluctuating
factors. However, was certain was that the majority of the world was affected by a major
global recession. This meant that visitors were be more cost conscious and discerning in
their choices of holidays than ever before.177 This made holidaying at home more popular,
and led to the concept of the ‘staycation’.

Scotland enjoyed a rise in visitors in Q3 2009 compared to Q3 2008, with an increase of
25% in visits from North America and an increase of 43% in visits from countries outside
Europe and North America.178 The UK experienced a 6% increase in visitors from North
America and a 1% increase from other countries outside Europe and North America in Q3
2009 compared Q3 2008. Scotland also received 7% more tourist expenditure in Q3 2009
than in Q3 2008.

The table below gives a snapshot of the position in Angus and its neighbouring LAs, and
Scotland in 2006.

                  Table 86: Tourism Related Sector 1 - Key Indicators by LA, 2006

                        Total     GVA at      Total   Total                Total
                                                               GVA /
LA                     Turnover Basic Prices Labour Employees          Labour Costs
                                                              Employee
                         £m         £m       Costs £m '000s             / Employee
Scotland                 12,640           4,040           2,019            207         £19,600        £9,800
Aberdeenshire              290             140              69               7         £19,500        £9,900
Angus                      170              60              36               3         £18,600       £10,800
Dundee City                430             120              61               5         £22,000       £11,200
Perth & Kinross            340             140              91               8         £18,500       £11,700
Source: Scottish Government (2009), Scottish Economic Statistics 2008
1. Tourism related figures are compiled from the following Standard Industrial Classification (SIC) codings:
SIC55.1 55.4/ SIC63.3/ SIC92.5 92.7

It can be seen from the following tables, that the tourism industry in Angus is more volatile
than in Scotland, and it is reasonable to state that it is more vulnerable to outside influences
and market changes than larger LAs. It can also be seen that there are less business units
in Angus than there were in 2000, although there are more employees, and the total turnover
has increased by 18.8% more than the Scottish average.

GVA per employee in Scotland has increased by 27.7% between 2000 and 2007, whereas in
Angus it has increased by 101.8%. Gross wages and salaries per employee have risen by
39.3% for Scotland and by 113.1% in Angus. These are significant increases, more than
doubling the amounts reported in 2000. However, it would appear that these increases are
largely attributable to what appears to have been a remarkable tourism season in 2007. It is
important to note that Carnoustie hosted the 2007 Open Golf Championship.


176 Tourism Intelligence Scotland, Series 3: Knowing our Markets...Scotland's Visitors, p.10.
177 Tourism Intelligence Scotland, Series 3: Knowing our Markets...Scotland's Visitors, p.10.
178 ONS (2010), MQ6 Transport Travel and Tourism - Overseas Travel and Tourism Quarter 3 2009



                                                                                                               85
When the figures for 2006 are examined it still shows that Angus has increased more than
the national average in both categories, although the differences are less marked.

                 Table 87: Tourism Related Sector - Key Indicators, 2000 – 2007

                                                        Total                           Total
                            No. of     % change                      % change                    % change
                  Year                               Employees                        Turnover
                            Units      from 2000                     from 2000                   from 2000
                                                       ‘000’s                            £m
                 2000      17,256          --           181.1            --        6,501.00         --
                 2001      17,483         1.3            182            0.5        7,438.90        14.4
                 2002      17,578         1.9           187.4           3.5        8,476.50        30.4
                 2003      17,440         1.1           187.9           3.8        9,270.60        42.6
  Scotland
                 2004      17,515         1.5           194.5           7.4       10,761.00        65.5
                 2005      17,868         3.5           199.7          10.3       11,421.20        75.7
                 2006      18,045         4.6           206.7          14.1       12,644.80        94.5
                 2007      18,414         6.7           208.8          15.3       13,294.20       104.5

                 2000        375           --            3.2              --            96          --
                 2001        375          0.0            3.3             3.1           97.2        1.3
                 2002        378          0.8            3.7           15.6           117.3        22.2
                 2003        370          -1.3           3.1            -3.1          113.4        18.1
   Angus
                 2004        364          -2.9           2.6           -18.8          111.5        16.1
                 2005        360          -4.0           3.3             3.1          129.8        35.2
                 2006        370          -1.3           3.3             3.1           166         72.9
                 2007        365          -2.7           3.3             3.1          214.4       123.3

                         GVA / Employee            % change          Gross Wages &               % change
              Year
                               (£)                 from 2000      Salaries / Employee (£)        from 2000
              2000              --                    --                     6,958                 --
              2001            15,190                  --                      8,098                16.4
              2002            15,730                 3.6                      8,335                19.8
              2003            16,331                 7.5                      8,765                26.0
 Scotland
              2004            17,891                 17.8                     8,879                27.6
              2005            18,392                 21.1                     9,338                34.2
              2006            19,463                 28.1                     8,870                27.5
              2007            19,405                 27.7                     9,695                39.3

              2000            12,467                  --                    6,201                    --
              2001            11,927                - 4.3                   6,233                   0.5
              2002            12,759                 2.3                    6,754                   8.9
              2003            14,092                 13.0                   7,865                  26.8
  Angus
              2004            16,793                 34.7                   8,540                  37.7
              2005            14,157                 13.6                   7,577                  22.2
              2006            18,036                 44.7                   9,408                  51.7
              2007            25,154                101.8                   13,216                113.1
 Change for Scotland calculated as the change since 2001, in the absence of figures for 2000.
Source: ONS, Annual Business Inquiry (Compiled by the Scottish Government 2009)




                                                                                                             86
Employment statistics from VisitScotland for 2003 - 2006 show the following.

                         Table 88: Tourism Related Employment, 2003 - 2006

                                                                                               As a % of all 2006
                               2003             2004             2005            2006
                                                                                                 employment
 Angus & Dundee                9,387            7,541           9,600            9,400                8.7
 All Scotland                199,250          204,224         210,000          218,000                   9.2
Source: VisitScotland, Tourism in Angus and Dundee 2006 – 2009

The tourism market has been shown to be volatile linked with world events such as 9/11 and
SARS but overall world tourism is forecast to grow at 4-5% per annum in the long term.179
For the past decade, up to 2007, the UK economy had experienced uninterrupted growth.
The recent strong growth in international tourism around the world (approximately 5% per
annum) continued through 2007 and into 2008. Demand since then, was severely affected
by turbulence and uncertainty in the major economies. Consumer conditions deteriorated
over 2008 eroding GDHI.

It is expected that when looking at the whole of 2008, growth in international travel will have
been around 2-3%. In 2009, the economies of Europe, US and UK are likely to perform
below long term averages with economic restructuring continuing throughout the year.

Industry analysts, including the WTO, believe that there will be little improvement shown in
travel during 2009, with growth rates expected to be less than 2%. However, it is expected
that recovery may occur in 2010. The UK Tourism Survey (September 2008) highlights that
trips to Scotland have fallen by 3.8% in the last year. Between January and June 2008, there
was a 4% decrease in all overseas trips to Scotland compared to the same period in
2007.180

Therefore, the 2009/2010 season was always likely to present unique challenges to the
industry. Despite this, Sterling remained weak against most major inbound tourism markets
through 2009. In Scotland, 2009 was the year of the ‘Homecoming’. Inspired by the 250th
anniversary of the birth of Robert Burns, Homecoming Scotland 2009 extended an invitation
to Scotland's people at home and abroad to reconnect with their roots. Throughout the year
and across the country, more than 400 events were staged. Although the impacts of this on
the tourism sector and the economic benefits are still being evaluated, it has been reported,
that based on an early analysis of the programme, which looked at the revenue generated
by 25 of the 112 events, the Scottish economy has been boosted by at least £19.4m. 181

Reflecting the difficult economic environment, employment in hotels & restaurants the
Dundee City Region (DCR) is expected to fall by 12,000 between 2008 and 2011, but
recovery thereafter sees employment returning to its 2008 level by 2015.182

In 2007, the number of overnight trips to Scotland was just below 16 million, resulting in
spending of £4.2 billion. The majority of these trips were made by UK residents, representing
82.5% of all trips. Even with the benefit of a lower Sterling exchange rate, the downturn
means that Scotland may see a contraction in the number of overseas visitors in 2009 and
2010, furthermore while domestic UK visitor numbers may increase, spend per trip is likely to
remain under pressure.


179 Scottish Executive (2006), The Next Decade - A Tourism Framework For Change, p.2
180 VisitScotland (2009), Corporate Plan - Maximising The Economic Benefit Of Tourism To Scotland 2009 – 2012, p.12
181 BBC (24.11.09), “Homecoming Scotland boosts economy by 'at least £19m'”
182 Slims & Oxford Economics (2009), Scottish Enterprise Dundee City Region – Economic Review 2009, p. 8



                                                                                                                      87
The following table shows the estimates for the volume and value of tourism in Scotland in
2007. It can be seen that approximately half of overnight expenditure in Scotland was from
other parts of the UK.

Table 89: Volume and Value of Tourism and Average Length of Stay and Spend in Scotland,
                                    by Origin, 2007

                                                                 Origin
                                            Scottish          Rest of UK           Overseas              All
                                           residents 1         residents           residents
Total number of trips (millions)               6.23               6.89                2.76             15.88
Total spending (£ million)                     815               2,020               1,343             4,178
Total no of nights (millions)                 17.81              29.64                24.2             71.65
Average length of stay (nights)                 2.9                4.3                 8.8               4.5
Average spend per trip (£)                     131                293                 487               263
Average spend per night (£)                     46                 68                  55                58
Source: UK Tourism Survey (UKTS) and International Passenger Survey (IPS) / VisitScotland). 1 Not National
Statistics

Angus offers significant opportunity for outdoor activity (linked with its high quality of
environment, historical and cultural breaks). Given the areas relatively low employment
base in this sector, there is scope for growth.

Additional initiatives such as those focusing on Ancestral Tourism and Tartan Day offer new
ways to attract tourists to Angus, especially out of season, with Tartan Day falling in April
each year. VisitScotland Research Findings on ancestral tourists suggests that one third
visit outwith June – September and the top 4 destination areas are Edinburgh/Lothians,
Glasgow/Clyde Valley, Perthshire/Angus/ Dundee/Fife and south of Scotland.

Overall, it would appear that visitor numbers to the top Angus attractions fell by 824 between
2007 and 2008. This breaks down as follows.

                Table 90: Visitor Numbers at Top Angus Attractions, 2007 & 2008

                                                                                                   % change
                      Attraction                                2008               2007
                                                                                                  from 08/07
 Arbroath Abbey                                                13,070             11,251             +16.2
 Forfar Loch Country Park                                   202,979(E)         185,863 (E)           +9.2
 Arbroath Museum                                             19,701(E)          18,239(E)            +8.0
 Crombie Country Park                                       120,036(E)           121,581             +1.3
 Gateway to the Glens Museum, Kirriemuir                     9,952 (E)          9,820 (E)            +1.3
 Montrose Museum                                               15,046             15,421              -2.4
 House of Dun, Montrose                                         8,734              9,098              -4.0
 Basin Wildlife Centre, Montrose                               10,827             11,571              -6.4
 Edzell Castle, By Brechin                                      7,109              7,816              -9.0
 Glamis Castle                                                107,280            118,801              -9.7
 Pictavia Visitor Centre, Brechin                               5,253              5,866             -10.5
 Barrie's Birthplace, Kirriemuir                                5,381              6,202             -13.2
 The Meffan, Forfar                                            15,334             19,997             -23.3
                                                              540,702            541,526              -0.2
Source: VisitScotland (2008) Scottish Visitor Attraction Survey - Attractions in Angus and the City of Dundee



                                                                                                                88
In Angus, the number of hotels and restaurants registered fell from 310 in 2007 to 295 in
2008. This correlates to a drop of 0.5% from 2007 to 2008. In the same time period, there
was a drop of 0.2% nationally. This can be seen below. In addition to this, since the
publication of these figures there have been several established hotel closures, such as the
Royal Hotel in Forfar, the and Corner House in Montrose. In addition to this, the Hillside
Hotel in Montrose has applied for planning permission to covert the building into flats. The
outcome of this is currently pending.

   Table 91: Number and % share of total - Hotels and restaurants in Angus and Scotland

                                     Angus                                            Scotland
                          No                        %                       No                           %
    2001                  300                      8.1%                   12,645                        8.5%
    2002                  315                      8.5%                   13,040                        8.7%
    2003                  310                      8.6%                   13,015                        8.8%
    2004                  305                      8.4%                   13,295                        8.9%
    2005                  300                      8.4%                   13,000                        8.9%
    2006                  295                      8.1%                   12,765                        8.7%
    2007                  310                      8.3%                   13,130                        8.7%
    2008                  295                      7.8%                   13,085                        8.5%
Source: Scottish Government (2009), National Statistics - Scottish Corporate Sector Statistics

           Figure 23: Percentage of Hotels and Restaurants as Registered Enterprises,
                               Angus and Scotland, 2001 – 2008
 9.0%


 8.8%


 8.6%


 8.4%


 8.2%


 8.0%
                                    Angus          Scotland
 7.8%


 7.6%
        2001




                         2002




                                                                                                                    2008
                                            2003




                                                              2004




                                                                               2005




                                                                                                 2006




Source: Scottish Government (2009), National Statistics - Scottish Corporate Sector Statistics

The DCR Economic Review 2009 reported that the DCR has above average levels of
specialisation within two key sectors: Life Sciences and Tourism. It also reported that
tourism is the largest employer among the key sectors within DCR, accounting for 10% of
total employment. It also has an above average level of specialisation relative to Scotland as
a whole, and employment in this sector increased by 11% between 1999 and 2007. This can
be seen in the table below.


                                                                                                               89
                           Table 92: Performance of Key Sectors in the DCR

                                                                                 % change
                                  No of                         % share of
                                               No of jobs                          since           Specialisation
                                 jobs in                        all jobs in
                                                in DCR                            1999 in            in region*
                                Scotland                          region
                                                                                  region
 Energy                          40,700           2,800              1%            22%                      83
 Financial Services              91,600           5,100              3%             9%                      68
 Food & Drink                    46,000           2,700              1%            -16%                     71
 Life Sciences                   18,400           1,900              15             -1%                     124
 Tourism                        219,900          20,000             10%            11%                      110
 Creative Industries             62,200           2,000              1%             N/A                     124
Source: Annual Business Enquiry and SLIMS calculations. * Scotland = 100

In 2007, the tourism sector accounted for 10% of all jobs in the Region, slightly above the
equivalent share of 9% for Scotland and 8% for GB. These jobs were distributed across the
various sub-sectors in 2007 as follows:

        Hotels represented the largest sub-sector of the tourism industry within DCR,
         accounting for 27% of all jobs ;

        Restaurants and bars accounted for 43% of tourism-related employment;

        24% of tourism jobs in DCR were in recreational, cultural or sporting activities; and

        The remaining 6% is split between travel agencies and forms of accommodation
         other than hotels. 183


Relative to Scotland as a whole, DCR has an above average level of employment
specialisation within 7 of the 10 sub-sectors of tourism. This demonstrates the importance of
the industry to the regional economy. This breaks down as follows:

        The share of jobs within hotels, camping & caravan sites and other lodgings in DCR
         are 27-30% higher than the Scottish average;

        DCR also employs above average numbers within sporting activities and, to a lesser
         extent, bars, restaurants and cultural activities; and

        The only tourism sub-sectors that are under-represented within DCR relative to
         Scotland are other recreational activities, travel agencies and youth hostels.


Recent trends show that the expansion of the tourism industry within DCR between 1999
and 2007 was largely driven by increased employment within restaurants, hotels, and the
cultural sector. The total number of tourism jobs within DCR increased by 11% between
1999 and 2007. This was much slower than the growth of 23% across the Scotland over the
period. Employment change within each of the sub-sectors between 1999 and 2007 was as
follows:

        Restaurants were the fastest growing sub-sector within DCR, with an increase of
         1,500 jobs;


183 Slims & Oxford Economics (2009), Scottish Enterprise Dundee City Region – Economic Review 2009, p. 67



                                                                                                                    90
        Employment within hotels and library, archives, museums etc combined accounted
         for over 900 new jobs in DCR;

        The only sub-sector to contract between 1999 and 2007 was bars, in which there
         were 850 fewer jobs in 2007 than in 1999.

In terms of tourism expenditure, there was a fall between in the value of tourism expenditure
in DCR between 2003 and 2006, but this was slower than the decline across Scotland as a
whole. The figures for expenditure from both UK and overseas tourists and show that:

        Tourists to DCR spent a total of £369 million in 2006, accounting for 9% of total
         tourism expenditure in Scotland;

        There was a fall of 4.7% in the value of tourism expenditure in DCR between 2003
         and 2006, but this was slower than the equivalent fall of 6.3% across Scotland;

        Perth & Kinross attracted the highest share of tourism expenditure of all the areas
         within the DCR, accounting for 51% of the total in 2007;

        Angus & Dundee was the only area within the DCR to experience an increase in
         tourism expenditure over the period, with growth of 1.8%; and

        There was a slight decline of 1.7% in the value of tourism expenditure within North
         East Fife between 2002 and 2003.184

                          Table 93: Tourism Expenditure (£m), 2003/2007

                                                                                       Change 2003/07
                                               2003              2007              Amount           %
 Angus & Dundee                                 113               115                  2           1.8%
 Perth & Kinross                                207               188                -19          -9.2%
 North East Fife                                67                66                  -1          -1.7%
 DCR                                            387               369                -18          -4.7%
 Total Scotland                                4,484             4,203              -281          -6.3%
Source: Visit Scotland

A number of developments are currently planned or underway within Angus. Over the
coming years, these will enhance the tourism offering of the region and are likely to provide
many more job opportunities in the sector. For example, Forbes of Kingennie, have unveiled
plans for a new championship 18-hole golf course and youth academy. The £55 million
development, which is backed by Ryder Cup winner Darren Clarke, would also include a
five-star hotel and spa and new homes at Wellbank. It is estimated that the development
could create more than 300 jobs in the construction phase and 150 new posts when the
resort complete.185

In November 2006, Glamis Castle became the first tourist attraction in the UK to enter into a
business agreement with the Great Wall of China. The Castle will now be promoted to the
millions of Great Wall visitors each year and the agreement also opens the door to the
prospect of increasing business and cultural exchanges between Glamis, Angus and China.




184 Slims & Oxford Economics (2009), Scottish Enterprise Dundee City Region – Economic Review 2009, p. 69
185 D C Thomson & Co Ltd, The Courier (11.07.09), ‘Golf resort plan wins backing’



                                                                                                            91
Such partnerships are normally only sealed between UN World Heritage sites - the Great
Wall also has an agreement with the Pyramids. Within 20 years the WTO predicts China will
be the fourth most important market in terms of the numbers of outbound tourist visitors,
estimated at £100 million.

                                     DIGITAL MEDIA & CREATIVE INDUSTRIES

The digital media and creative industries sector covers; computer games, electronic
entertainment, communication technologies, software development, animation, film video,
radio and television, graphic design, architecture, advertising, arts and culture, publishing
music production and new media.

It is one of the industry sectors which does not lend itself well to classification as it covers
such a broad range of companies, which in turn makes it difficult to compile meaningful
statistics without double counting. In 2005, a Scottish Enterprise review of the sector found
that the digital media and creative industries sector in Scotland was responsible for 94,000
jobs - or 4% of total employment. There is considerable growth potential in this sector from
3% to 7% for non-digital media rising to 10% to 20% for digital media per annum.

Interactive Tayside, a partnership between public, private and academic sectors to develop
and promote Tayside's digital media industry, estimates that there are over 350 businesses
operating in the area of digital media in Tayside, with 76 of the 392 registered with
Interactive Tayside based in Angus (19%). There are over 3,300 people employed in the
sector, which generates a combined annual turnover in excess of £185 million. The sector
has experienced growth in employment of 225% since 2000 and a further 2,000 jobs are
expected to have been created by 2010.

The area's 2 universities and 3 FE colleges carry out leading edge research and deliver
innovative and high quality teaching across a wide range of digital media related subjects.
Every year, over 900 students, from over 50 different nationalities, graduate in digital media
disciplines from the region's HE and FE institutions.186

There are no specific figures associated with employment in digital media in Angus but an
analysis of data held on BERA suggests that within the sector there are 101 companies, who
employ approximately 401 staff. This comprises business in the following categories:

              Architects                                               Architectural Services
              Audio Visual Equipment Sales and Supplies                Digital Media Services
              Marketing, Promotion and Advertising                     Photography
              Printing and Publishing                                  Sign Makers
              Videography                                              Telecommunications.

                                              RETAIL AND WHOLESALE

As of the end of September 2009, the Scottish retail sector employed 235,016 people,
10.1% of the national workforce. Scottish retail turnover was £24 billion, accounting for 11%
of total Scottish turnover. Average gross weekly earnings in retail in Scotland were £218,
slightly less than the £250 average for the UK as a whole.187




186 Interactive Tayside (2007), About Interactive Tayside
187 British Retail Consortium (2009), Key facts.



                                                                                                  92
There are around 24,840 retail businesses in Scotland and 83% of those employ less than
10 people.188 The table below shows the number and proportion of retail establishments in
Angus, its neighbouring LAs, and Scotland.

                         Table 94: Retail establishments in Scotland – June 2008

                                      Retail                         All                Retail establishments as a %
         Region
                                  establishments              establishments                of all establishments
 Aberdeenshire                        1,015                       13,580                              7%
 Angus                                    520                       4,390                          12%
 Dundee City                              775                       4,275                          18%
 Perth & Kinross                          860                       6,760                          13%
 Scotland Total                        24,840                      195,330                         13%
Source: Skillsmart Retail Ltd (2008), Scottish Retail Sector, National Background Briefing, p.5

Between 2007 and 2017, 15,000 new retail jobs are expected to be created in Scotland,
while a further 98,000 jobs will need to be filled as a result of people leaving the sector
(replacement demand). This is a total requirement of 113,000 jobs.

Retail, wholesale and hotels accounted for 24% of employee jobs in Angus in 2007. That is
above the national figure of 22%. These figures represent 8,600 and 528,700 jobs
respectively.189 In Angus, there are 495 retail units.190 The sector provides some of the
county’s largest employers, such as Tesco and Morrison’s.

There is currently a planning application submitted for a new Sainsbury’s store in Montrose,
which would be the first Sainsbury’s store in Angus. If approved it could provide more than
200 additional jobs.191 In September 2009, Asda announced plans to open its first store in
Forfar and create up to 270 new jobs in the town. Asda, along with project partners AWG
Property and Deanway Development have lodged a notice with Angus Council announcing
its intention to submit a planning application for the St James House site. The site was
granted planning permission for 4,800 square metres of retail space following a successful
appeal to the Scottish Government. Asda aims to submit a full planning application after
consulting the community on the proposals.192 If it goes ahead it has the potential to create
up to 270 full and part time jobs, as well as additional opportunities during the construction
and development of the store.193 There are other parties interested in opening new
supermarkets in both Arbroath and Kirriemuir, however, there are currently ongoing planning
issues.

Retailing trends are working against the small town shopping environment. Market demand
from the major retailers is for edge or out of town stores to maximise population catchment.
For convenience people shop in supermarkets, often where they are employed rather than
where they live. Shopping patterns are liable to alter further with increased internet
shopping and free delivery. Most of the town centres within Angus contain a number of
empty shops, some of which have been empty for a long time.




188 Skillsmart Retail Ltd (2008), Scottish Retail Sector, National Background Briefing , p.3
189 Scottish Government (2009), Angus Economic Briefing.
190 ONS (2009), UK Business: Activity, Size and Location – Table A1.1
191 Press and Journal (04.12.09), ‘Supermarket Giant could open Angus branch in 2011’.
192 Planning Resource (2009), ‘ASDA unveils plans for Forfar store’
193 Forfar Dispatch (0.306.10), ‘Roads concern for Asda store bid in Forfar’



                                                                                                                   93
                                                    HEALTH CARE

The health care sector refers to, ‘services provided to individuals or communities by agents
of the health services or professions for the purpose of promoting, maintaining, monitoring,
or restoring health.194 It is difficult to extract employment figures for the sector, as services
are provided by range of public and private sector companies.

Within Tayside in 2002, 202,772 people were employed in health care. In Angus, health
care made up approximately 11.8% of all employees. Between 1999 and 2002 the number
of health care employees in Angus fell by 17.4% compared to an increase of 97.7% in
Dundee over the same period. Between 2001 and 2002 however there was a marginal
increase in health care employment in Angus.

NHS Tayside is responsible for meeting the health needs of more than 388,780 people living
in Tayside. NHS Tayside employs approximately 14,000 staff and provides a range of
primary, community-based and acute hospital services for the populations of Dundee, Angus
and Perth & Kinross. Its annual budget is over £750 million which equates to approximately
around £2 million spent per day.

NHS Tayside’s principal health organisations are the Tayside NHS Board, the Single
Delivery Unit and 3 Community Health Partnerships (CHPs) in Angus, Dundee and Perth &
Kinross. CHPs became live on 1 April 2006, and share the same boundaries as the LAs.
They are responsible for the planning and delivery of community health provision such as
pharmacy and GP services.

The changing demographic structure of Angus and Scotland, as discussed in Chapter two,
means that there will be a greater proportion of the population over the working age in the
future. The challenges of an ageing population will raise major resource issues in relation to
health care services. Workforce planning needs to address the staffing needs of a growing
care sector, to ensure that Angus is able to attract and retain staff in a competitive market.195

In Angus, there continues to be ongoing reorganisation and investment in health care
provision. Opportunities for growth exist in this sector. While there continue to be closures
in this sector within Angus e.g. Sunnyside Royal Hospital in Montrose, there has also been
significant investment in Stracathro Hospital, near Brechin.

The contract for a £20 million mental health unit at Stracathro was signed in June 2010, and
construction began in July. The new facility is expected to open at the end of 2011.196 The
unit will replace the services provided at Sunnyside. The new mental health unit will have
50 in-patient beds, day care facilities, a pharmacy, chiropody and occupational therapy
services, along with offices for clinical and administrative staff.197

Also at Stracathro, a deal was concluded in November 2006 which saw the creation of
Scotland's first private treatment centre for NHS patients. NHS Tayside received a £15
million grant over 3 years to employ a private company - Netcare, to provide clinical services
using the facilities at Stracathro in evenings and weekends to treat NHS patients from
Tayside, Fife and Grampian.




194 The Medical Dictionary (2000), Definition of Health Care.
195 Angus Council (2007), Angus Community Plan 2007 – 2012, p.7
196 STV News (02.07.10), ‘Construction starts on £95m mental health hospitals’
197 D C Thomson & Co Ltd, The Courier (28.12.2009), ‘Mental health unit plans progress’



                                                                                               94
The 24-bed Scottish Regional Treatment Centre (SRTC) carried out 7,500 ear, nose, throat,
orthopaedic procedures and other surgical procedures over the three year period, and health
bosses have acknowledged the unit was key to helping them achieve waiting time targets.198

In February 2010, the SRTC become operational under NHS control. There was a hiatus in
surgical activity since the three year deal ended at the start of 2010. In the interim period
there was a refurbishment of the 3 operating theatres so that they could be in full use during
the day.199

The Scottish Government has pledged £5 million a year to allow NHS Tayside to provide
services for patients from the three health board areas who previously sent patients to the
SRTC. However, there will not be a straight transfer of services, as the requirements from
the health boards were now different from what was provided by Netcare.

The new deal with NHS Grampian will see a return of visiting orthopaedic surgeons to
Stracathro. NHS Fife previously sent patients requiring plastic surgery to a hospital in
Lothian but that is now being transferred to Stracathro. A total of 16 FTE nursing staff are
being recruited to Stracathro under the new SRTC deal.

                                            EDUCATION AND ACADEMIA

The education department is the largest of Angus Council’s departments. It employs
1,277.13 FTE teaching staff and 774 FTE non-teaching staff, and its revenue budget for the
financial year 2007/2008 was £91.6 million. The service is delivered by 57 primary schools
(total roll 8,957 pupils), 8 secondary schools (7,152 pupils), with provision for 1,587 pre-fives
in nursery classes operating within 53 primary schools.200

The other major employer within the sector is Angus College which in 2009 employed over
400 staff (254 FTEs, of whom 131 are lecturers and 121 are support staff.) It currently has a
roll of over 11,500 students and trainees, (over 1,600 full-time students), with approximately
80% achieving the qualifications for which they enrol.201 The College has an annual budget
of around £11.5 million, and is recognised as being one of the most efficient and financially
sound colleges within the FE sector.

                                                 CONTACT CENTRES

Scotland is a world-leader for contact centre operations. The sector has developed rapidly
over the past 10 years or so, and some of the largest and most sophisticated call centres in
Europe are located in Scotland. More than 60,000 people are employed within 300 contact
centres. Several multinational giants have established operations here, while a large number
of outsourced contact centres provide expertise in a variety of sectors.202

Talking Tayside, the Tayside contact centre forum predicts that the industry will continue to
be a growing source of employment in the area, and estimates that it currently employs a
workforce of around 7,500 in the area.203

While there has been a trend developing for UK businesses to utilise offshore contact
centres, mainly due to lower salary costs, the threat of outsourcing has, according to



198 D C Thomson & Co Ltd, The Courier (05.01.2010), ‘Patients’ fears of Stracathro surgery delays’
199 D C Thomson & Co Ltd, The Courier (21.01.2010), ‘Stracathro unit poised to reopen’
200 Angus Council (2007), Education Department Service plan.
201 Angus College (2009), Freedom of Information Publication Scheme, p.1
202 Scottish Development International, Contact centres in Scotland
203 Talking Tayside (2009), Talking Tayside Operational Plan, p.1



                                                                                                     95
Datamonitor, been ‘massively exaggerated with absolute growth in onshore contact centre
                                                                          204
positions being far greater than offshore throughout the forecast period’.

Due to the small number of contact centres operation in Angus, it would be disclosive to
discuss employment figures. However, this is another sector where there is scope of
expansion.

                                                SUMMARY

Fitting with the decline in economic activity and employment rates for most of the sectors
given above, Angus has recorded employment decline. In some e.g. construction, it is
anticipated that this decline was temporary, however in others such as agriculture and
engineering it is likely that share of employment will continue to decline. Despite the fall in
economic activity and employment rates, unemployment in Angus continued to decrease,
until the recent recession. Certain sectors would appear to offer opportunity for employment
growth potentially forestry, food & drink, tourism, biotechnology and life sciences, digital
media & creative industries and contact centres. Overall it would appear that the Angus
economy has been slow to embrace new opportunities.

The main causes of the sectoral imbalance which exist are geographical and historic. In a
European context, Scotland is geographically peripheral. The core-periphery model is often
referred to in development studies and describes a situation where development is
characterised by a dominant region and a much less developed set of places surrounding
the core, with development levels declining as distance from the core increases.205

In a European context, the so-called 'Blue Banana' area has traditionally been the main
driving seat of development and commerce in Europe. The ‘banana’ extends from London
through Germany to Milan. Recently, however, commentators have identified the 'Sunbelt'
from Milan to Valencia and the 'Yellow Banana' from Paris to Warsaw as the growth areas of
the future.206 In terms of the economy of Angus, these developments will see a rise in issues
relating to geographical context.




204 Datamonitor (2004), ‘Offshore contact centre outsourcing’
205 Office of the Deputy Prime Minister, Polycentricity Scoping Study. Available from www.odpm.gov.uk/index.asp?
Id=1145446#P37_970
206 G. Hospers, ‘Abstract: Beyond the blue banana? Structural change in Europe’s geo-economy’. Available from
http://ideas.repec.org/p/wiw/wiwrsa/ersa02p210.html



                                                                                                             96
 Chapter Four              Employment
                                          The Local Labour Market.

Labour markets have a local dimension because of the friction of space.207 Geography limits
the employment horizons of individuals. There are, in fact, many labour markets, delineated
by occupation, geography, age, etc. However, these submarkets are likely to be inter-
related.

This can make local labour markets difficult to identify, not least because people’s
perceptions of what is local differs. Travel to Work Areas (TTWAs) are the Government’s
approximation of a self-contained local labour market. TTWA’s are defined according to the
following criteria:

       a minimum working population of 3,500;
       75% of those living in the area should also work there;
       75% of those working in the area should also live there.

TTWAs are based upon the commuting patterns of the ‘average worker’, omitting variations
across gender, occupation and other characteristics which are important in labour market
terms.

The most recent TTWA area statistics were compiled in 2007 using the journey to work
statistics from the 2001 Census. These statistics designated 243 areas. The number of
TTWAs has steadily decreased, partly as a result of increased car ownership and mobility.
Other factors include a decline in traditional sectors, where local working was common; more
double-earner households who cannot live near both work places, and more complex
working patterns (e.g. people who work partly at home). The table below shows past
revisions.
                           Table 95: Number of TTWAs in the UK

                          Year                                                 No of TTWAs
                          1960                                                     642
                          1984                                                     322
                          1998                                                     308
                          2007                                                     243
Source: ONS (2008), Travel to Work Areas

The current TTWAs which incorporate parts of Angus are Dundee, and Forfar & Montrose.
The following table shows the characteristics of these.

                           Table 96: TTWAs: Key Statistical Characteristics

                                          Number of         Number of         % Self-containment      Surface
   TTWA
                     LA (part)            employed            jobs at         Supply    Demand          area
   name
                                          residents         workplaces         side        side       (sq km)
                Dundee, Angus
  Dundee                                    88,772            92,573            89.5           85.8    499
                (part), Fife (part)
 Forfar &
                   Angus (part)             25,847            22,409            70.3           81.1   1,876
 Montrose
Source: Coombes, M, Centre for Urban & Regional Development Studies in Newcastle University, and Bond, S.,
ONS, Travel-to-Work Areas: The 2007 Review

207 TERU, University Of Glasgow (2004), Local Economic Development, Dynamics Of Labour Markets, p.1



                                                                                                              97
Every TTWA should meet a minimum level of self-containment with respect to commuting
flows. There are two elements to this, which can be seen in the table above;

   Supply side – the percentage of all an area’s working residents who work in the area
   Demand side – the percentage of all workers in an area’s workplaces who live in the
    area

TTWAs must meet the required level of self-containment on both measures. This means the
critical level of self-containment for any area is the lower of its supply or demand side
measures. For most cities, the demand-side value is higher, as there tends to be a net inflow
of commuters. Smaller areas surrounding large cities tend to have rather large net outflows
of commuters, mainly to those larger cities, so the supply-side measure is higher.208

While TTWA information is useful, most labour market information is collated at a local
authority level, therefore the information in the following sections will presented in
accordance. When commuting patterns are examined at an LA level, the following results
can be seen.

                  Table 97: Commuting patterns by LA, 2008 (residence based)209

                                                           People living and working in Scotland




                                                                                                                                                                                           Net ‘across Scotland’ flow INTO LA




                                                                                                                                                                                                                                                                 Resident working age population in
                                                                                    Live in the LA but work outwith




                                                                                                                                                       Work in the LA but live outwith
                                                   as % of resident working age




                                                                                                                      as % of resident working age




                                                                                                                                                                                                                                as % of resident working age
                                                    population in employment




                                                                                                                       population in employment




                                                                                                                                                                                                                                 population in employment
                         Live and work in the LA




                                                                                       OUTFLOW                                                       INFLOW                               NET INFLOW                                                                       employment
Scotland            1,678,500 69.4% 690,100 28.5%                                                                                                            -                                    -                                       -                    2,429,000

Aberdeenshire         68,200                       56.0%                          49,200                              40.4%                           8,700                              -40,500 -33.2%                                                        121,900

Angus                 32,700                       63.4%                          17,600                              34.1%                           5,800                              -11,800 -22.8%                                                         51,800

Dundee City           54,900                       86.9%                          7,600                               12.1%                          24,700                              17,100                                 27.0%                           63,300

Perth & Kinross       51,200                       78.3%                          13,100                              20.0%                          11,000                              -2,100                                 -3.2%                           65,700

Source: Scottish Government (2010), Annual Population Survey




208 Coombes, M, Centre for Urban & Regional Development Studies in Newcastle University, and Bond, S., ONS, Travel-to-
Work Areas: The 2007 Review
209 Levels rounded to the nearest thousand. Proportions are calculated on unrounded figures. Totals may not equal the sum
of individual parts due to rounding.




                                                                                                                                                                                                                                                                                                      98
                                          Labour supply and demand.

In order for the labour market to function to its maximum capacity, there needs to be a
balance between labour demand and supply. There are a number of factors which are useful
in determining this balance. These are shown below.

                             Table 98: Factors in Labour Demand and Supply


                   Labour Demand                                                  Labour Supply

 Relative prices of labour to capital.                        Number of individuals in the labour force.

                                                              Number of hours of labour that each
 Demand for the product/service produced.
                                                              individual chooses to make available.
                                                              Productivity of the output of each of these
 Productivity level of workers.
                                                              hours.
 Level of wages (with higher wages being
                                                              Levels of remuneration available.
 linked to lower demand).
Source: TERU (2004), Local Economic Development – Dynamics of the Labour Market.

As previously discussed, the population of Scotland is projected to increase slowly from
5.117 million in 1994 to 5.206 million in 2011. Similarly, the labour force is projected to
increase slightly by 0.4% between 2006 and 2031.210 In line with this, employment in
Scotland has steadily grown from 2.3 million in 1982 to 2.6 million in 2007. This trend is
expected to continue in the future with total employment in Scotland expected to increase by
84,000 by 2017. This is a 3% increase in the number of jobs between now and 2017.211

Through growth in the economy and the need to replace workers who leave employment,
around 100,000 job openings are expected to occur in Scotland each year between 2007
and 2017. Whilst 84,000 new jobs are expected to be created in Scotland between 2007
and 2017, the majority of job openings will be replacement jobs. An additional 922,000 job
openings will occur in the same period to replace workers who leave employment. Some of
these workers will also return to the labour market during this period.

It must be borne in mind that these figures were compiled at a time when it was not possible
to take into account the impact of the global recession on the Scottish economy. Due to a
time lag in analysis and compilation of statistical information of this type, it may be several
years before an accurate, revised forecast can be compiled.

Statistics relating to the employment, unemployment and benefit dependency of the resident
population of an area are used to provide indicators of labour supply. Statistics relating to
jobs and vacancies at workplaces in an area provide evidence of labour demand. Earning
statistics provide indicators relating to both labour supply and demand.212

When looking at the labour market it is useful to consider employment rates and the levels of
working age economic activity, which is the number of people in employment plus the
number of people who are unemployed as a proportion of the total number of working age
people. By definition the employment rate is bounded by the economic activity rate.213
There are two ways of looking at employment:

210 GROS (2008), 2006 based Population Projections
211 FutureSkills Scotland (2008), Labour Market Projections 2007 – 2017.
212 National Statistics, Local Area Labour Markets: Statistical Indicators.
213 Scottish Executive, Social Justice Milestone Data, Milestone 15. Available from www.scotland.gov.uk/Resource/Doc/1135
/0004818.doc



                                                                                                                        99
                the number of people in employment; or
                the number of jobs.

 These 2 concepts represent different things - one person can have more than one job.
 People aged 16 or over are classed as employed by the Labour Force Survey, if they have
 done at least one hour of work in the reference week surveyed or are temporarily away from
 a job (e.g. on holiday). Employed people can be classified into 1 of 4 categories:

                employees;
                self employed;
                unpaid family worker (doing unpaid work for a family-run business); or
                participating in a government supported training programme.214

 Employment rates in Angus are generally above the national average, and compare well
 with those of neighbouring LAs.

                     Figure 24: Employment Rates in Angus and Scotland, 2008/9
     100%

       90%

       80%
       70%

       60%

       50%

       40%

       30%

       20%

       10%

        0%
                                 - full time     - part time                   - self
                    All                                        - employees                 Males   Females
                                   work             work                     employed
   Angus          80.7%           71.6%           28.4%          85.4%        14.1%        83.0%   78.2%
   Scotland       75.4%           75.2%           24.8%          89.4%        10.6%        78.2%   72.4%
Source: Scottish Government Analytical Service Division (2010), Angus Economic Briefing.




 214 FutureSkills Scotland, Labour Market Glossary, p.10



                                                                                                        100
                     Figure 25: Employment rates by LA, 2004/2008, by residence
 85%




 80%




 75%




 70%




 65%

                     Scotland         Aberdeenshire            Angus   Dundee City        Perth & Kinross

 60%
    2004                          2005                         2006                2007                     2008
Source: Scottish Government (2009), Statistics from the Annual Population Survey 2008

 The economically active are classified as people aged 16 and over who are either in
 employment or unemployed. The economically inactive are people who are neither in
 employment nor unemployed. The main reasons for being economically inactive are long-
 term sickness or disability, being a student or looking after family.

 Research has shown that a higher proportion of people in rural areas are economically
 active that in the rest of Scotland. Inactivity rates are lower in rural Scotland. In keeping
 with these figures, a slightly higher percentage of the working age population are in full time
 education or training in the rest of Scotland than in rural areas. The unemployment rate (the
 number of people unemployed as a percentage of the number economically active) is lowest
 in rural areas.215

 The figure below demonstrates the breakdown of economic activity by geographical area in
 Scotland, in 2008.




 215 Scottish Government (2008), Rural Scotland Key Facts, 2008.



                                                                                                        101
                        Figure 26: Economic Activity by Geographic Area, 2008
 100%
                                     Remote Rural        Accessible Rural       Rest of Scotland
                  84%                                                                                        86%
            81%                                                                                        83%
                        79%                              79% 81%                                                   80%
  80%                                                               75%



  60%



  40%


                                   19% 16% 21%
  20%

                                                                                3% 3% 5%
   0%
         Economically Active       Economically         Employment Rate     Unemployment Rate        Employed, in
                                     Inactive                                                     education or training
Source: Scottish Government (2009), Rural Scotland Key Facts, 2009.

Research has indicated that Angus will suffer from a decline of the economically active
population as the imbalance of between young and old grows to 2018.216 The graph below
shows the rates of levels of economically active people in Angus, compared to Scotland. It
can be seen that the rate in Angus is higher than the Scottish average. In addition to this,
the level of economic activity in Angus between April 07/March 08 and April 08/March 09
appears to have increase, as opposed to the Scottish rates for the same period.

                                   Figure 27: Rates of Economic Activity
 85
 84
 83
 82
 81
 80
 79
 78
 77
                                   Angus (%)               Scotland (%)            Great Britain (%)
 76
 75
        Apr 04-Mar 05      Oct 04-Sep 05       Apr 05-Mar 06    Apr 06-Mar 07    Apr 07-Mar 08         Apr 08-Mar 09
Source: Nomis (2009), Labour Market Profile - Annual Population Survey




216 DTZ Pieda (2005), Montrose Economic Study, p. i



                                                                                                                       102
The table below shows the breakdown of the levels by of gender. Scottish Government
research shows that for all LA areas male employment rates were higher than female rates.

                        Table 99: Economic Activity Level by Gender in Angus (%)

                                     Jan 2004-      Jan 2005-      Jan 2006-   Jan 2007-     Jan 2008-
Economic activity rate
                                     Dec 2004       Dec 2005       Dec 2006    Dec 2007      Dec 2008
  Working age                          79.7           81.2           85.0        83.8          84.4
  Males                                84.8           85.7           88.7        87.7          86.6
  Females                              74.2           76.5           81.1        79.7          82.0
Source: Nomis, Labour Market Profile - Annual Population Survey

The number of jobless people who are outside the labour market, commonly classified as
economically inactive, is lower in Angus than for Scotland.

           Figure 28: Economically Inactive – Angus & Scotland (Oct 2008-Sep 2009)
                   25
                   20
                   15
                   10
                    5
                    0
                            Economically inactive          Wanting a job            Not wanting a job
    Angus (%)                       16.7                          6.3                      10.4
    Scotland (%)                    20.2                          5.7                      14.5
    Great Britain (%)               21.1                          5.6                      15.5
Source: Nomis (2009), Labour Market Profile - Annual Population Survey

There are less people in Angus than Scotland who are economically inactive, but do not
want a job. Economic inactivity lies on the supply side of the labour market, as
economically-inactive people have the potential to move into the labour market at some point
in the future. Information on inactivity is important for a number of reasons. Over recent
years, there has been increasing recognition of the need to consider the size and
composition of the inactive group. This analysis is used in assessing potential labour supply.
Broadly speaking, the inactive group can be divided into those who want a job and those
who do not. While this is not an exact reflection of whether people will move into economic
activity in the near future, it does give some indication of the strength of people's labour
market attachment.217

The table below demonstrates the number of unfilled job centre vacancies, the number of
unfilled job centre vacancies per 10,000 of working age population, and the rate of JSA
claimants per unfilled job centre vacancy, for Angus, Scotland and GB.

These figures are based on the number of live unfilled vacancies handled by JobCentrePlus.
These are vacancies actively available to jobseekers on the count date, however, coverage
relates only to vacancies notified to JobCentrePlus and therefore only represents a market
share of vacancies throughout the whole economy.



217 ONS (2008), About Economic Inactivity.



                                                                                                        103
  In October 2009, for each vacancy notified in Angus, there were 3.9 people claiming JSA.
  By April 2010 this had increased to 8.5. This reinforces the presence of an over supply of
  potential workers. This is commonly the case during a period of recession. It is also
  interesting to note that the figures for October 2009 show that the situation in Angus was
  less serious than at the Scottish and British level, however, this trend had reversed by April
  2010, although figures for all areas had worsened, showing a tightening of the labour
  market.
                     Table 100: Job Vacancies – October 2009 & April 2010

                                                                                           October 2009                                                                      April 2010
                                                                           Angus                  Scotland                        GB                 Angus Scotland                                      GB

   Unfilled JobCentre
                                                                                515               19,335                      270,706                     257                17,929                  244,241
   vacancies (Nos)
   Unfilled JobCentre
   vacancies per 10,000                                                         79                         60                      73                     40                      55                      66
   working age population
   JSA claimants per unfilled
                                                                                3.9                        6.7                    5.7                     8.5                    7.8                     6.2
   JobCentre vacancy
  Source: Nomis (2010), Labour Market Profile - Angus

  While the table above shows only a snapshot of the vacancy ratio at the given dates, the
  graph below shows the pattern between January 2006 and October 2009. It can be seen
  that for all 3 areas, there are fluctuations in the numbers, although Angus is most volatile. It
  also shows that historically the rate of JSA claimants per unfilled jobcentre vacancy has
  tended to be higher in Angus than elsewhere.

     Figure 29: JSA claimants per unfilled JobCentre vacancy, January 2006 - October 2009
   25
                                   Angus                                                                                  Scotland
                                   Great Britain                                                                          Linear (Angus)
                                   Linear (Scotland)                                                                      Linear (Great Britain)
   20



   15



   10



    5



    0
                 Mar-06




                                                                       Mar-07




                                                                                                                               Mar-08




                                                                                                                                                                                       Mar-09
        Jan-06



                          May-06



                                            Sep-06

                                                     Nov-06

                                                              Jan-07



                                                                                May-07



                                                                                                  Sep-07

                                                                                                            Nov-07

                                                                                                                     Jan-08



                                                                                                                                        May-08



                                                                                                                                                           Sep-08

                                                                                                                                                                    Nov-08

                                                                                                                                                                              Jan-09



                                                                                                                                                                                                May-09



                                                                                                                                                                                                                  Sep-09
                                   Jul-06




                                                                                         Jul-07




                                                                                                                                                 Jul-08




                                                                                                                                                                                                         Jul-09




Source: Nomis (2009), Labour Market Profile - Angus



                                                                                                                                                                                                                  104
The nature of the statistics means that when the series is based on smaller geographical
areas, such as a LA, they are much more susceptible to local changes, such as local
redundancies etc. However the trend lines show that in all three areas there has been an
increase in the number of JSA claimants per unfilled vacancy. In Angus, this rise has been
less severe than in Scotland or GB.

The table below provides a breakdown of the industrial sector in which the notified vacancies
relate to between 2003 and 2008. The only 2 sectors to show an increase in the number of
vacancies in this period were energy & water, and banking, finance & insurance etc.

                 Table 101: Notified Vacancies by Industry, Scotland, 2003-2008

                                         March            March      March      March      March   March
Industry
                                         2003             2004       2005       2006       2007    2008
Agriculture, hunting, forestry & fishing 310               319        208        346        318     233
Energy & water                                  168        140        406        146        655    681
Manufacturing                                  2,064      1,925      1,535      1,358      1,680   1,235
Construction                                   1,463      1,255      1,262      1,242      1,435   1,438
Distribution, hotels & restaurants             7,228      8,188      7,756      6,438      6,904   6,909
Transport, storage & communication             1,935      2,645      1,350       745        890    913
Banking, finance & insurance etc               6,599      8,556      8,528      9,705      14,085 16,121
Public admin, education & health               5,841      6,285      5,136      4,802      5,173   4,748
‘Other’ services                               2,000      2,092      1,734      1,349      1,456   1,255
All                                           27,608 31,405 27,915 26,131 32,596 33,533
Source: Scottish Government (2009), Scottish Economic Statistics 2008, p. 60.

The table below demonstrates the levels of annual change which there have been to
vacancy numbers, by sector.       In Angus there has been a decrease in the number of
vacancies in only 2 sectors – energy & water and ‘other’ services. In Scotland in September
2009, it can be seen that there had been a decline in all sectors. By April 2010, this had
changed with only agriculture, forestry & fishing, construction, retail & wholesale & hotels,
and ‘other’ services showing declining figures.

                Table 102: Vacancies in Angus and Scotland – September 2009

                                                        Angus                            Scotland
   Industrial group                            No's      Annual change           No's      Annual change
   All industries                              353            11%               24,696         -27.3%
     Agriculture, forestry & fishing            4           33.3%                128           -68.5%
   Production & construction
     Energy & water                              0            -100%              105          -71.8%
     Manufacturing                              30            11.1%              867          -23.1%
     Construction                               20            11.1%              765          -38.9%
   Services
     Retail & wholesale & hotels                63             8.6%             6,855          -18%
     Transport & communications                 10            900%               628          -15.6%
     Finance and business                      103            24.1%             9,930         -37.7%
     ‘Other’ services                          123            -1.6%             5,418          -5.8%
Source: Scottish Government Analytical Service Division (2009), Angus Economic Briefing.



                                                                                                       105
                      Table 103: Vacancies in Angus and Scotland – April 2010

                                                              Angus                              Scotland
   Industrial group                                 No's       Annual change              No's     Annual change
   All industries                                   279            -3.1%                 23067          0.5%
     Agriculture, forestry & fishing                 1            -75.0%                  152          -61.4%
   Production & construction
     Energy & water                                   0                --                352          208.8%
     Manufacturing                                   35              600.0%              728           9.3%
     Construction                                     7                --                698          -24.6%
   Services
     Retail & wholesale & hotels                     81              92.9%               4419         -20.0%
     Transport & communications                       5                 --                603         56.6%
     Finance and business                            90               -8.2%              1297         30.8%
     ‘Other’ services                                60              -56.8%              4818         -23.6%
Source: Scottish Government Analytical Service Division (2010), Angus Economic Briefing.

Another factor in determining levels of supply and demand in the labour market is the level of
wages available. Higher wages are linked to lower demand, with low wages linked to a
potential over supply of workers. From the information presented previously, it would appear
that there is evidence to suggest that this is the case in Angus. Further reinforcing this is the
fact that average earnings in Angus are consistently below the Scottish average. Factors to
be taken into account are the high levels of seasonal work present in the agricultural and
food processing industries, and the high prevalence of work in the traditionally lower paid
manufacturing and retail sectors. The table below shows the median full time annual gross
pay in Scotland, by occupation group.

            Table 104: Median Full Time Annual Gross Pay in Scotland, 2007-2008218

 Occupation Group                                                                  2007 (£)           2008 (£)
 Managers and senior officials                                                      34,083            34,992
 Professional occupations                                                           32,738            33,496
 Associate professional and technical occupations                                   26,725            27,694
 Administrative and secretarial occupations                                         17,393            18,078
 Skilled trades occupations                                                         21,992            23,285
 Personal service occupations                                                       16,240            17,498
 Sales and customer service occupations                                             14,260            14,837
 Process, plant and machine operatives                                              20,837            21,167
 Elementary occupations                                                             15,808            16,999
Source: ONS (2009), Annual Survey of Hours and Earnings

Earnings in Angus, by workplace and by residence, for 2008 and 2009, are shown in the
tables below, along with a comparison of neighbouring LAs and Scotland. The tables also
show the difference in the rates between Angus and Scotland.

It can be seen that rates of pay for males and females working in Angus are lower than for
those residing in Angus. Overall the wages rates for both sexes are higher for those who

218 Note: Employees on adult rates who have been in the same job for more than a year.




                                                                                                                 106
reside in Angus than for those who work there. This suggests that the difference can be
attributed to the nature of employment and the sectoral structure of the labour market.

Since 2008, the difference between wage rates in Angus, and the national rate has
increased, for all categories, except for full time males by workplace.

         Table 105: Average Gross Weekly Pay by Workplace and Residence, 2008

            Average Gross Weekly Pay for Full Time Workers by Workplace, 2008
                        Angus      Dundee      Aberdeen     Perth &      Scotland    % difference
                         (£)       City (£)    shire (£)   Kinross (£)     (£)      from Scotland
Total Full Time         440.00     465.30      467.80       448.70       462.60        -4.89
Full Time Males         446.30     502.70      530.10       503.60       504.90       -11.61
Full Time Females    391.50 391.40       347.50      334.00      401.10       -2.39
            Average Gross Weekly Pay for Full Time Workers by Residence, 2008
                        Angus      Dundee      Aberdeen     Perth &      Scotland    % difference
                         (£)       City (£)    shire (£)   Kinross (£)     (£)      from Scotland
Total Full Time         460.00     439.70      521.10       447.00       462.90        -0.63
Full Time Males         502.90     469.70      553.90       504.30       505.00        -0.42
Full Time Females       392.00     382.40      425.20       337.90       399.90        -1.98
Source: ONS, Annual Survey of Hours and Earnings 2008

         Table 106: Average Gross Weekly Pay by Workplace and Residence, 2008

            Average Gross Weekly Pay for Full Time Workers by Workplace, 2009
                        Angus      Dundee      Aberdeen     Perth &      Scotland    % difference
                         (£)       City (£)    shire (£)   Kinross (£)     (£)      from Scotland
Total Full Time         421.70     465.60      500.00       419.00       473.60       -10.96
Full Time Males         454.70     497.20      555.70       464.10       510.30       -10.90
Full Time Females    401.60 362.20       434.00      421.80      419.90       -4.36
            Average Gross Weekly Pay for Full Time Workers by Residence, 2009
                        Angus      Dundee      Aberdeen     Perth &      Scotland    % difference
                         (£)       City (£)    shire (£)   Kinross (£)     (£)      from Scotland
Total Full Time         461.30     419.30      532.60       465.30       472.20        -2.31
Full Time Males         510.20     454.90      584.30       492.60       510.20        0.00
Full Time Females       401.60     362.20      434.00       421.80       419.90        -4.36
Source: ONS, Annual Survey of Hours and Earnings 2009

The graph below shows that in 2001, higher percentages of those working outwith Angus
were in intermediate, managerial or professional occupations. This supports the position
regarding wages rates discussed above.




                                                                                                107
            Figure 30: Angus Residents by Occupation and Place of Employment, 2001
25
                                                                                        % Angus residents working outwith Angus
                                                                                        % Angus residents working in Angus
20                                              10



15                                                                                                                         4

                                                                                                                                               3

10                                                                                      1                  4
                                                                 5
                                                15
                                                                                                                          13
 5                                                                                     10                                                     11
                                                                                                           8
                            3                                    7
          2
          1                 2
 0




                                                                                                     Lower supervisory
     Large employers




                                                               Intermediate occ.




                                                                                   and own account




                                                                                                                                              Routine occ.
                                           Lower managerial




                                                                                   Small employers




                                                                                                                          Semi-routine occ.
                       professional occ.




                                                                                                     and technical occ.
     managerial occ.




                                            and professional
         and high




                                                                                       workers
                            Higher




                                                  occ.




Source: East of Scotland Labour Market Information, Angus Migration and Commuting patterns.

The fact that educational attainment in Angus is above the Scottish average impacts the
arguments regarding why those who reside in Angus, rather than those who work in Angus,
enjoy high levels of remuneration. If there is not an appropriate supply of jobs available in
the local labour market this will encourage those with training and qualifications to find
employment elsewhere.

This can have a detrimental impact. The table below reveals that Angus has a higher share
of employees in administrative & secretarial, skilled trades occupations, and process plant &
machine operatives. This combined with the projected decrease in manufacturing, could
result in a widening imbalance between those with and without qualifications.




                                                                                                                                                             108
          Table 107: Employment by occupation in Angus (April 2008 - March 2009) 219

                                                              Angus (no’s) Angus (%) Scotland (%)   GB (%)
Soc 2000 major group 1-3                                         20,700           38.2       41.5   43.5
  1 Managers and senior officials                                 6,600           12.1       13.3   15.6
  2 Professional occupations                                      6,400           11.8       13.2   13.1
  3 Associate professional & technical                            7,700           14.1       14.8   14.6
Soc 2000 major group 4-5                                         14,200           26.1       22.9   22.2
  4 Administrative & secretarial                                  6,200           11.4       11.3   11.4
  5 Skilled trades occupations                                    8,000           14.6       11.6   10.7
Soc 2000 major group 6-7                                          8,000           14.7       16.8   15.9
  6 Personal service occupations                                  4,600           8.4        8.8     8.3
  7 Sales and customer service occupations                        3,400           6.2        7.9     7.5
Soc 2000 major group 8-9                                         11,500           21.1       18.8   18.4
  8 Process plant & machine operatives                            4,300           7.9        7.3     7.0
  9 Elementary occupations                                        7,200           13.1       11.5   11.3
Source: Nomis (2009), Annual Population Survey, broken down according to the Standard Occupational
Classification 2000.

However, there are going to be job opportunities available. FutureSkills Scotland's labour
market projections state that it is likely that there will be a:

             Modest growth in the number of jobs;
             Considerable demand for new employees to replace those who leave
              employment;
             Employment growth concentrated in public and private service industries and in
              higher skilled and service orientated occupations;
             Large number of jobs arising in service industries and managerial and
              professional occupations; and
             Increasing numbers of people obtaining higher levels of qualifications220

However, jobs which are reliant on the production of goods or services, such as plant and
machine operatives, are often thought to be more susceptible to demand deficient
unemployment. They are more reliant on the external influences which drive the economy.
Unless state intervention raises the level of demand artificially, there is little that can be done
to tackle this form of unemployment.

When there is an imbalance in the labour market, hard to fill vacancies become more
common. Vacancies can be hard-to-fill for various reasons, but they fall broadly into three
groups:

        applicants have not been of sufficient quality - for 30% of establishments this was the
         sole reason for hard-to-fill vacancies;
        there have been few or no applicants - cited by 31% of establishments; or
        a combination of both of these reasons - cited by 39% of establishments.



219 Numbers and % are for those of 16+. The % is a proportion of all persons in employment
220 FutureSkills Scotland (2008), Labour Market Projections 2007 to 2017



                                                                                                           109
Where vacancies are hard-to-fill because there are a low number of applicants then this
suggests that the reason may be attributable more to the nature of the job on offer. Where
vacancies were hard to fill because of the poor quality of applicants, employers were asked
to state whether candidates lacked the right skills, the right qualifications, the required work
experience, or whether applicants perceived to have poor attitude, motivation or personality.

A skill shortage vacancy arises only where the vacancy is hard to fill because candidates
lack the required skills, qualifications or experience. That is, skill shortage vacancies do not
include those where applicants are perceived by the employer to have a poor attitude, to
lack motivation or have an unsuitable personality.

Of the 69,800 vacancies at the time of the survey in 2008, 16,400 or 24% were skill shortage
vacancies. Skill shortage vacancies represented 47% of all hard-to-fill vacancies. The
number of skill shortage vacancies in 2008 was still small, equivalent to around 1% of all
employees and affecting 5% of establishments.221

The tables below demonstrate that of the hard-to-fill vacancies reported, the highest
incidence in Scotland is in the agriculture, forestry & fishing and real estate, renting &
business activities sectors. It also shows that machine operatives, skilled trades people and
managers & senior officials are the three occupational groups that provide the most hard-to-
fill vacancies.
    Table 108: Hard-to-fill and Skill Shortage Vacancies as a Proportion of Employees by
                                            Industry
                                                                       Hard-to-fill    Skill shortage
                                                            No. of
                                                                    vacancies as a % vacancies as a %
                                                          employees
                                                                      of employees     of employees
 Agriculture, forestry & fishing                           20,200         4.0%              2.7%
 Energy and water                                            36,700        2.0%           0.8%
 Manufacturing                                              200,200        1.5%           0.5%
 Construction                                               123,200        2.0%           0.7%
 Wholesale & retail                                         305,200        1.2%           0.4%
 Hotels & restaurants                                       129,100        2.0%           0.7%
 Transport, storage & communication                         103,200        1.1%           0.3%
 Financial intermediation                                    72,300        0.5%           0.3%
 Real estate, renting & business activities                 354,100        2.7%           1.2%
 Public administration & defence                            215,200        0.8%           0.6%
 Education                                                  270,900        0.6%           0.3%
 Health & social work                                       243,800        1.9%           1.5%
 Other services                                             142,500        1.5%           0.8%
Source: Scottish Government (2009), Scottish Employers Skill Survey 2008




221 Scottish Government (2009), Scottish Employers Skill Survey 2008



                                                                                                  110
    Table 109: Hard-to-fill and Skill Shortage Vacancies as a Proportion of Vacancies by
                                          Occupation

                                                                     Hard-to-fill    Skill shortage
                                                      No. of
                                                                   vacancies as a   vacancies as a
                                                    vacancies
                                                                   % of vacancies   % of vacancies
 Machine operatives                                    4,800            71%                17%
 Skilled tradespeople                                  7,300               62%           24%
 Managers and senior officials                         3,900               61%           17%
 Associate professionals                              13,600               55%           37%
 Professionals                                         7,500               51%           22%
 Sales and customer service staff                      7,300               50%           24%
 All occupations                                      69,800               50%           24%
 Personal service staff                                6,800               39%           18%
 Elementary staff                                      8,500               38%           14%
 Administrative staff                                  8,800               34%           24%
Source: Scottish Government (2009), Scottish Employers Skill Survey 2008


This re-inforces the evidence presented previously, that the labour market is likely to
polarise, and that there is likely to be greater competition for jobs. It would also seem that
the labour market is likely to tighten, which will mean all round greater competition for
employment, with those who are likely to be more successful being those who hold the
qualifications and skills desired by employers.

In light of the current economic recession, this would appear to be the case. Higher
unemployment has levels have been recorded, but the duration of long term unemployment
in Angus fell from 36.7% for six months or longer in October 2006, to 29.2% in October
2009. Similarly, the 19.1% who were claiming JSA for more than one year fell from 19.1% in
2006 to 10.1% in 2009. This indicates that whilst unemployment overall has increased,
there are still job opportunities available. This places increased importance on the
employability of an individual.




                                                                                                 111
 Chapter Five               Employability
New concepts that were popularised during the 1990s included the employability of
individuals and the growing importance of flexibility in the labour market.222 The concept of
‘employability’ captures an individual’s ability to gain sustained access to labour market
opportunities, to enter the labour market and employment successfully for a reasonable
period of time, and also to improve employment prospects and rewards, where that is the
individual’s wish.223

The Scottish Government’s official definition of ‘employability’ is ‘the combination of factors
and processes which enable people to progress towards or get into employment, to stay in
employment and to move on in the workplace’.224

The concept has 2 main points of origin:

        the changing nature of the employment contract between employers and employees,
         with ‘employability’ being offered instead of job security;
        the changing nature of public employment policy with increasing emphasis on skills-
         based solutions to economic competition and work-based solutions to social
         deprivation.225

At its simplest level, employability is a function of the match between the demand for labour
and the supply of labour. The report of the 1994 Social Justice Commission concluded that,
‘In the end, employment goes to the employable’.226

The Scottish Government argues that if Scotland is to be a rich country and a rich society,
then the people of Scotland must have the freedom to design, implement and benefit from
an employability and skills system that suits Scotland’s evolving needs. This includes the
ability to align benefits, tax credits and employment services fully with Scotland’s skills,
lifelong learning, education, childcare, and health services.227

The Scottish Government states that their focus on employment and skills reflects their
importance to the life chances of people in Scotland, as well as to the future collective
economic wellbeing. It argues that Scotland can only prosper if the structural barriers that
prevent people from contributing as effectively as possible are removed.228

This is especially relevant to Angus, which already has lower wage rates than the Scottish
average. (Please refer to chapter 4 for details).

For those in employment, employability concerns may not seem immediately relevant.
However, as older technologies are being continuously replaced or updated there is an
increased requirement to continually upskill the workforce. This is coupled with the
increasing importance of the ‘new economy’ which is driven by knowledge and ideas. This
means that employees are increasingly required to multi task, and have a high degree of
competency in several areas.



222 TERU, University Of Glasgow (2004), Local Economic Development: Dynamics Of Labour Markets, p.1
223 FutureSkills Scotland, Labour Market Glossary, p.10
224 Scottish Executive (2006), Workforce Plus - An Employability Framework for Scotland , p.1
225 TERU, University Of Glasgow (2004), Local Economic Development: Dynamics Of Labour Markets, p.1
226 Commission on Social Justice (1994), Social Justice - Strategies for National Renewal
227 Scottish Government (2009), Employability and Skills - Taking forward our National Conversation, p.3
228 Scottish Government (2009), Employability and Skills - Taking forward our National Conversation, p.5



                                                                                                           112
Measures for those who are unemployed are important because lack of skills or skills mis-
match are significant barriers to re-entry into the workforce. There is a clear overlap
between policies in this area, and measures that can be taken to tackle economic exclusion.

In recent years, the appreciation of training and human resource development has
increased. There has been a growing realisation that investments made in training the
workforce and future workforce have the same kind of potential returns as investments in
more quantifiable areas, such as property or equipment. A highly skilled workforce is
arguably more productive and competitive. Interventions in the supply side of the labour
market tend to focus on tackling areas of market failure, a common route being attempts to
resolve under investment in training.

Scotland experiences a unique skills and employability paradox. Scotland has fewer lower
skilled people and more highly skilled people than anywhere else in the UK outside London.
In addition, Scotland's qualification profile is improving at a faster rate than for the UK as a
whole: between 1997 and 2004 the proportion of the working age population in Scotland with
at least a level 4 qualification increased from 22% to 29%, compared to an increase across
the UK from 21% to 26%. Scotland also has the highest labour market participation rate of
any UK country.229

In addition to this, Scotland’s investment in skills stands comparison with any other part of
the UK. Qualification levels over the last 30 years, have been higher than in the rest of the
UK. Indeed, the UK Leitch Review of Skills highlighted Scotland as the only nation or region
of the UK where the percentage of people with a Higher Education (HE) qualification
outnumbers the percentage with a basic school leaving qualification. Despite this Scotland’s
long term economic performance lags that of the UK as a whole.230

Between 2007 and 2017, it is projected that around 100,000 new job openings will occur
every year in Scotland. Growth in the economy is projected to provide 84,000 of the jobs
openings between 2007 and 2017. The bulk of the opportunities, 922,000 job openings, will
arise due to the need to replace workers who leave employment, either permanently or
semi-permanently. Some of these workers will re-enter the labour market during the
projections period. Employment growth will be concentrated in public and private service
industries and in higher skilled and service-orientated occupations. Similarly, most of the job
openings will arise in service industries and managerial and professional occupations.231

However, the impact of the recession on these predictions, whilst still uncertain, is likely to
have been negative in terms of the increase in the number of people losing and therefore
seeking employment.

The trend towards a more qualified workforce looks likely to continue. Employment by
occupation is expected to change, with the greatest numbers of new jobs expected to be in
higher skilled and service orientated occupations, breaking down as follow:

        Professional occupations (+60,000 new jobs);
        Managers and senior officials (+40,000 jobs); and
        Sales and customer service occupations (+39,000 jobs).




229 Scottish Government (2009), Employability and Skills - Taking forward our National Conversation, p.9
230 Scottish Government (2009), Employability and Skills - Taking forward our National Conversation, p.26
231 FutureSkills Scotland (2008), Labour Market Projections 2007 to 2017 , p.19



                                                                                                            113
Jobs will be lost in some occupational groups. The three groups projected to see a decline in
the total number of jobs are:

        Elementary occupations (-63,000 jobs will be lost);
        Skilled trades (-22,000 jobs); and
        Process, plant and machine operatives (-9,000 jobs)232

Employment by qualification level is expected to change over the period to 2017. The table
below shows that the trend in employment is towards a higher skilled workforce. It is
expected that increasing numbers of people with Scottish Vocational Qualification (SVQ)
level 4 and above qualifications will be in employment. In contrast, there will be a fall in the
proportion of the workforce with no qualifications. These changes in qualification levels of
employment mirror the changes expected to occur in the occupational structure of
employment.

           Table 110: Projections of Employment by Highest Qualification, 2007 - 2017

                                   2007                  2012              2017             Change 2007 - 2017
 Level 5                          188,000              274,000            386,000                 106%
 Level 4                          783,000              866,000            921,000                 18%
 Level 3                          552,000              546,000            521,000                  -6%
 Level 2                          502,000              470,000            422,000                 -16%
 Level 1                          378,000              354,000            326,000                 -14%
 No Qualifications                225,000              176,000            134,000                 -41%
 Total                           2,628,000             268,8000          2,712,000                 3%
Note: Totals may not sum due to rounding
Source: FutureSkills Scotland (2007), Labour Market Projections 2007 to 2017, p.30

The proportion of the population who have a qualification under level 4 has declined year on
year since 2001 (from 20% in Q4 2001, to 14% in Q4 2008).233 The table below shows that
Angus has a lower level of people in this category than the national average, and rates
favourably in comparison with its neighbouring LAs.

   Table 111: Proportion of working age adults with SCQF Level 4 qualifications or below,
                                       2004 - 2008

                                            2004             2005             2006            2007             2008
 Scotland                                  18.8%            17.5%            16.3%           16.1%            14.8%
 Aberdeenshire                             13.2%            11.7%            13.8%           10.8%            11.9%
 Angus                                     14.3%            15.8%            13.8%           15.3%            11.9%
 Dundee City                               20.6%            18.0%            18.7%           18.6%            16.8%
 Perth and Kinross                         13.6%            13.1%            12.6%           14.3%            13.2%
Source: Scottish Government (2008), Local Area Labour Markets in Scotland: Statistics from the Annual
Population Survey 2008


The figure below further illustrates that it is expected that by 2012 there will be a positive
change in the qualification levels, with more people having higher level qualifications.




232 FutureSkills Scotland (2007), Labour Market Projections 2007 to 2017, p.28
233 Scottish Government (2008), Local Area Labour Markets in Scotland: Statistics from the Annual Population Survey 2008



                                                                                                                       114
         Figure 31: Projections of Qualifications Shares in the Working Age Population,
                                          2007 and 2012
    100%



      80%



      60%



      40%



      20%



       0%
                                      2007                                                   2012
                     No qualifications          Level 1       Level 2       Level 3       Level 4        Level 5
Source: FutureSkills Scotland (2007), Labour Market Projections 2007 – 2012

It is increasingly important for labour market entrants to have skills and qualifications. The
table below demonstrates that while the number of people in Angus who have low level
qualifications is below the national average, there are still significant numbers in this
category.

                                 Table 112: Qualifications - 2005 & 2008 234


                               Angus (No’s)              Angus (%)              Scotland (%)         Great Britain (%)
                               2005        2008        2005        2008        2005        2008          2005      2008
NVQ4 & above                  19,800 22,000            31.1        34.1        30.6        33.8          26.5      29.0
NVQ3 & above                  31,600 35,600            49.6        55.0        50.2        52.9          44.4      47.0
NVQ2 & above                  43,500 47,200            68.2        72.9        67.8        70.3          62.9      65.2
NVQ1 & above                  51,000 53,900            80.0        83.3        78.6        80.2          77.2      78.9
Other Qualifications          4,500       4,600         7.1         7.1         6.7         7.3          8.4       8.7
No Qualifications             8,200           12.8
                                          6,200                     9.6        14.7        12.5          14.3      12.4
Source: Nomis (2009), ONS Annual Population Survey.


The graph below illustrates that it is a situation that is improving over time, with the number
of people with no qualifications dropping, and the numbers with qualifications rising across
all National Vocational Qualification (NVQ) equivalent levels.


234 Numbers and % are for those of working age. The % is a proportion of total working age population.



                                                                                                                      115
                       Figure 32: Qualification levels in Angus, 1999 – 2008
100
                  NVQ4 and above                                                  NVQ3 and above                                        NVQ2 and above
 90
                  NVQ1 and above                                                  Other Qualifications                                  No Qualifications

 80

 70

 60

 50

 40

 30

 20

 10

  0
        Mar 99-    Mar 00-                      Mar 01-                   Mar 02-         Mar 03-          Jan 05-             Jan 06-                    Jan 07-                Jan 08-
        Feb 00     Feb 01                       Feb 02                    Feb 03          Feb 04           Dec 05              Dec 06                     Dec 07                 Dec 08

Source: Nomis (2009), Annual Population Survey.


Almost 9% more school leavers in Angus go into further education (FE) than the national
average. Almost three quarters (73.5%) of school leavers in Angus go into HE, FE or other
training.

      Table 113: Percentage of School Leavers from Publicly Funded Secondary Schools in
                   Scottish Education Authorities by Destination, 2008 - 2009
                                                                                                                                                         seeking employment or
                                                                                                                                Unemployed & seeking
                                                                                                                                employment or training




                                                                                                                                                                                  Destination unknown
                                                                                                                                                         Unemployed & not
                                                      Further education
                             Higher education




                                                                                                              Voluntary Work
                                                                                              Employment
                                                                               Training




                                                                                                                                                         training




 Aberdeenshire          39.4                        26.9                      1.3            22.2             0.3                 7.5                         1.0                1.5
 Angus                  35.3                        35.6                      2.6            13.9             0.0                 7.8                         1.8                3.1
 Dundee City            26.6                        34.3                      7.4            13.0             0.2               15.0                          2.5                1.0
 Perth & Kinross        32.9                        26.9                      3.3            24.9             0.7                 8.4                         1.5                1.4
 Scotland               34.9                        27.0                      5.1            18.4             0.2               11.5                          1.6                1.2
Source: Scottish Government (2009), Destinations of Leavers from Scottish Schools: 2008 - 09




                                                                                                                                                                                                        116
Angus has a lower percentage of pupils currently in school staying on to S5 and S6 level. In
Angus 61% of those in S4 stay on to S5, compared to the Scottish average of 65%, and 43%
of pupils in S4 stay on to S6, compared to 44% for Scotland.235 The table below illustrates
levels of S6 educational attainment in Angus, compared to its neighbouring LAs and
Scotland. It can be seen that Angus is below the national average.

                                        Table 114: S6 Attainment in 2008

                                                    Percentage of S4 roll from 2 years ago achieving
                              S4 to S6           1 award at   3 awards at     5 award at     1 award at
                             Staying on          SCQF 6 or    SCQF 6 or       SCQF 6 or     SCQF 7 or
                                Rate               better        better          better        better
 Scotland                       45.0                43.2          30.0            19.7          12.7
 Aberdeenshire                  42.8                46.7          34.6            23.5          15.7
 Angus                          40.6                41.7          28.2            17.7          12.1
 Dundee City                    37.1                34.6          22.5            14.0          10.7
 Perth & Kinross                 46                 47.1          33.3            23.7          16.8
Source: Scottish Government (2009), S6 Attainment by Local Authority: 1999 - 2008

Research conducted by Careers Scotland shows that graduates earn more than people who
have the entry qualifications necessary to do a degree course but have not undertaken one.
In 2001 - 2003, average annual graduate earnings were around £28,000 (in 2003 prices).
This was approximately 50% more that the earnings of people with sub-degree qualifications
such as Higher National Diplomas and Scottish Qualification Authority (SQA) Highers.236

In Angus there is a strong tradition towards FE rather than HE. This could go some way to
help explaining the lower levels of average pay discussed previously. In Angus, there is no
HE provision, however Angus College offers a wide range of further education courses to
Higher National Diploma (HND) level.

However, statistics on participation in HE at Scottish institutions for the academic year 2007-
08 reveal that since 2006-07 the number of students in Scottish HE has fallen by 6,935
(2.5%). Entrant numbers fell by 3.5% in 2007-08.237 However, the number of HE qualifiers
from Scottish institutions has continued to rise, by 0.5% (415 qualifiers) in 2007-08, to a
record high of 83,335 in 2007-08.238

Scottish colleges reported a decrease in qualifiers of 3.7%, down to 21,205, mostly due to a
decrease in the combined numbers of HNC/HNDs awarded (down by 7.4%). The number of
qualifications obtained by Scottish students fell by 2.1% from 62,710 in 2006-07 to 61,420 in
2007-08.

The table below shows details of the national and local picture, in terms of student numbers.
It can be seen that Angus College has seen the largest drop in student figures between
2006-07 and 2007-08, although its rate of decrease since 1999-2000 is significantly lower
than the national average.




235 Nomis (2009), SQA Examination Results in Scottish Schools
236 ibid.
237 Scottish Government (2009), Participation in Higher Education at Scottish Institutions 2007-08.
238 ONS (2009), Attainment in Higher Education and Destinations of Leavers 2007-08



                                                                                                      117
           Table 115: Students in Colleges in Scotland, 1999-00, 2005-06 & 2007-08

                              1999 -         2006 -       2007 -       % change over            % change since
                               2000           2007         2008           last year               1999-2000
 Total                        72,005         49,460       47,770            -3.4                     -34
 Angus College                  895            795          700              -12                     -22
 Dundee College               2,890          2,800        2,515              -10                     -13
Source: Scottish Government (2009), Participation in Higher Education at Scottish Institutions 2007-08.

Low-skilled jobs in which employees are required to exercise a certain level of discretion are
expected fare better than those which require limited judgement. Hairdressing, for example,
is traditionally regarded as a fairly low-skill occupation, however, the discretionary aspect of
the job removes much of the routine from the task and prevents this occupation being
dominated by automation.239

Concerns regarding the availability of jobs for those who do hold group 4 qualifications in
Angus is reinforced by the fact the level of working age people in Angus who have a degree
is lower than the national average. Although there are no universities in Angus, five
universities are within travelling distance, namely Dundee, Abertay, Aberdeen, Robert
Gordon’s and St Andrews. The graph below shows that in Angus there has been a
significant increase in the numbers since 2007 - 2008. The table illustrates that Angus does
not just lag behind Scotland, as a whole, but also its other neighbouring LAs.

           Figure 33: Percentage of Employees with Degree (June 2008 – June 2009)
          50
          40
          30
          20
          10
           0
                   % Working Age People with a Degree                          % change over 1 year
   Angus                              18.6                                                20
   Scotland                           20.4                                                1.9
Source: Scottish Government Analytical Service Division (2009), Angus Economic Briefing.

  Table 116: Proportion of those aged 25-59/64 in Employment who are Graduates by LA,
                              2004 - 2008, (residence based)

                                  2004              2005              2006              2007           2008
 Scotland                         21.6%            22.5%             23.8%             24.9%           25.2%
 Aberdeenshire                    22.1%            23.6%             20.8%             22.0%           21.3%
 Angus                            16.1%            17.4%             18.3%             18.3%           20.3%
 Dundee City                      20.8%            19.4%             23.3%             26.2%           26.4%
 Perth and Kinross                22.5%            26.7%             28.6%             27.6%           27.5%
Source: Annual Population Survey (Jan to Dec)
Notes: 1. Proportions are calculated on unrounded figures




239 TERU, University Of Glasgow (2004), Local Economic Development, Dynamics Of Labour Markets, p.22



                                                                                                               118
The increasing prominence of knowledge based and service sector industries means that
lower numbers of graduates in the workforce may become increasingly problematic for future
business development in Angus. Knowledge, particularly tacit knowledge is a key source of
competitive advantage in the economy of developed countries. Knowledge, innovation and
technology are increasingly important. Consequently this means that as the importance of
technology declines, to some extent, the importance of the physical location of a business,
and access to higher levels of qualified and trained labour become increasingly important.

In addition to this, employability levels may also have an impact on the ability of Angus to
attract inward investment. The Angus economy and population is based around seven main
towns. This works against the theory of ‘Agglomeration Economies’, which states that large
cities or agglomerations can offer a large labour force with a range of skills, and access to
other firms, suppliers and services, including the kind of specialists unlikely to be found in
smaller settlements.240

The increasingly interdependent nature of regional, national and even international labour
markets means that Angus is at a dual disadvantage. Convergence theorists state that due
to convergence and cohesion, low cost regions with high levels of labour available will attract
investment from higher cost, higher growth regions.

Angus, as a part of GB, no matter how peripheral, is unable to compete sustainably on a low
cost, low quality basis, as it will never be able to compete with countries such as those in
Eastern Europe or the Far East, which are less bound by regulations and institutional
frameworks, and whose labour markets therefore operate in a freer manner. It also means
that it cannot compete in the same way as parts of southern England, for example, as a
higher cost, higher growth region, as it cannot offer the same levels of return.

For this reason, it becomes necessary to decide whether to pursue an economic
development or economic growth route. Whereas economic development is concerned with
raising the general economic capacity of a local area amongst the widest possible group of
individuals and business, economic growth is concerned with raising the absolute economic
output of an area, which may or may not benefit of the wider business base or population.

Furthermore, the fact that Angus is still more dependent than the norm on primary industries
alludes to the fact that the main reason behind the structural imbalance has been a
fundamental shift in the economy, not only in Scotland or Britain, but the world. Factors
such as technological development and demographic change have meant that Angus has
perhaps more to overcome to achieve economic viability than some of its neighbours.




240 Office of the Deputy Prime Minister, Polycentricity Scoping Study.



                                                                                            119