donald jr macrae lloyds tsb scotland 12th april 2005 scotland’s business growth enterprise and...

Donald JR MacRae

Lloyds TSB Scotland

12th April 2005

Scotland’s Business Growth

Enterprise and Culture CommitteeThe Scottish Parliament

Scotland - The Gap?

Source: Measuring Scotland’s Progress Towards Smart, Successful Scotland 2004.

4 3 2 1

Scotland’s Quartile Position in OECD Countries 2002No. of

Comparators

30

18

11

21

26

9

2930

30

29

2815

Overall Progress

GDP per head

Growing Businesses

New business starts per 10k head pop.

% of businesses trading on-line

Business R&D as % of GDP

Relative productivity levels

Global Connections

Cost & coverage of broadband

% employers exporting

Graduates as % of workforce

Net migration as % population

Skills & Learning

Employment rate

% of 16-19 year old NEET*

% in employment undertaking training

* Not in education, employment or training.

0

40

80

120

160

200

240L

uxe

mb

ou

rg

US

A

No

rway

Eir

e

Sw

itze

rlan

d

Can

ada

Den

mar

k

Net

her

lan

ds

Au

stri

a

Icel

and

Au

stra

lia

UK

Bel

giu

m

Sw

eden

Fra

nce

Jap

an

Fin

lan

d

SC

OT

LA

ND

Ger

man

y

Ital

y

OE

CD

Sp

ain

New

Zea

lan

d

Ko

rea

Gre

ece

Po

rtu

gal

Cze

ch R

epu

bli

c

Hu

ng

ary

Slo

vak

Rep

ub

lic

Po

lan

d

Tu

rkey

Index: OECD = 100GDP per Capita - 2002 PPPs

Source: OECD (2004), DTI: Regional Competitiveness & State of the Regions (May 2004).

Note: Scotland estimated at 94.6% of UK.

high income high middle income group low middle income group group 101-120 51-100 over 120

International Comparisons of GDP Growth 1973 - 2001

5.2

3.33.0

2.8 2.82.6

2.3 2.2 2.1 2.01.8

1.6

Irel

and

No

rway

Can

ada

Un

ited

Sta

tes

Jap

an

Fin

lan

d

Ital

y

Fra

nce UK

Ger

man

y

Sw

eden

Sco

tlan

d

Country

Growth, per cent

Source: Goudie (2003).

Key Drivers of Productivity Improvement

• Human capital

• Physical capital

• Innovation

• Enterprise

• Competitiveness

Population Trends: Scotland and UK, 1951-2011

Source: Scottish Executive (2000).

UK

Scotland

Index:1995 = 100

Scotland’s Birthrate in a European Context

1.241.25

1.29

1.291.42

1.50

1.571.651.69

1.69

1.731.74

1.90

1.90

Italy

Spain

Germany

Greece

Portugal

Scotland

Sweden

Belgium

England

Netherlands

Finland

Denmark

France

Ireland

Total Fertility Rate* 2001

Source: Turner, A., Reflections on the Allander Series. (2004).

* Children per woman

Assumed Annual Long Term Migration by AgeScotland 2006-2007 onwards

4,000

3,000

2,000

1,000

0

-1,000

-2,000

-3,000

Persons

0-14 15-19 20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 65 & overYears of Age

Source: Experian Business Strategies, March 2005.

GDP per Hour Worked 2001

132.9119.9 118.1

100.0 95.787.2

France USA Germany UK Scotland Japan

Index: UK = 100

Source: Scottish Economic Report November 2004.

% working age population in employment OECD

% 16-19 year oldsNEET* OECD

% 20-24 year oldswith at least NVQ 3 UK

% young people with adequate skills (PISA) OECD

% working age populationin education, training UKor employment

Scotland - Skills and Learning

Indicator Quartile Position Comparators

4 3 2 1

Source: Measuring Smart Successful Scotland (2004). Training and Employment Unit, University of Glasgow.

* Not in education, employment or training.

Business R & D Expenditure

as % Output 1990-98

0.62

1.351.45

1.77

1.98

USA Germany France UK Scotland*

%

Source: Crafts and O’Mahony (2001) and DTI (2001).

*1995 - 99

Source: Global Entrepreneurship Monitor, Scotland 2003.

New Business Activity

Scotland

United Kingdom

Ireland

Aggregate Government Expenditure

0

10

20

30

40

50

60

Scotland UK

Source: Goudie (2002). Scottish Executive, GERS 2002-2003.

78-

79 79-

80 80-

81 81-

82 82-

83 83-

84 84-

85 85-

86 86-

87 87-

88 88-

89 89-

90 90-

91 91-

92 92-

93 93-

94 94-

95 95-

96 96-

97 97-

98 98-

99 99-

00 00-

01 01-

02 02-

03

% share in GDP, 1978-79 to 2002-03

Aggregate Government Expenditure % Share GDP 2003

58

56

55

52

51

51

51

50

49

49

49

48

47

47

43

40

35

Sweden

Denmark

France

SCOTLAND 2004**

Belgium

Austria

Finland

SCOTLAND 2002-03*

Italy

Germany

Netherlands

Portugal

Greece

Luxembourg

UK

Spain

Ireland

Source: Verhulst et al. (2005). *GERS 2002-2003; **Author’s calculation

Scotland - The Gap?

Source: Measuring Scotland’s Progress Towards Smart, Successful Scotland 2004.

4 3 2 1

Scotland’s Quartile Position in OECD Countries 2002No. of

Comparators

30

18

11

21

26

9

2930

30

29

2815

Overall Progress

GDP per head

Growing Businesses

New business starts per 10k head pop.

% of businesses trading on-line

Business R&D as % of GDP

Relative productivity levels

Global Connections

Cost & coverage of broadband

% employers exporting

Graduates as % of workforce

Net migration as % population

Skills & Learning

Employment rate

% of 16-19 year old NEET*

% in employment undertaking training

* Not in education, employment or training.