SURF Conference : The Future for Communities What could be the economic factors we need to be aware

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SURF Conference The Future for Communities
What could be the economic factors we need to be
aware of ?

• Ewan Mearns
• Scottish Enterprise

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The story so far ...What kind of economy has
been sustaining Scotlands communities in the
recent past ?
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Changing Economic Structure

• 1950s
• 25 Shipyards
• 113 Coal mines
• 6 Steel works
• 0 worlds oil
• Employment
• 35 manufacturing
• 45 services
• 6 business services

• 2000s
• 4 Shipyards
• 0 Coal mines
• 0 Steel works
• 3 of worlds oil
• 40 of EUs PCs
• Employment
• 15 manufacturing
• 75 services
• 21 business services

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A changing (but under-performing) economy ...

• Relative transition from a traditional
  manufacturing to a service and knowledge-based
  economy
• importance of foreign investors to manufacturing
  employment and productivity
• Scottish GDP growth and productivity lagging
  behind UK (and competitors) and gap widening
• declining unemployment during 1990s

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but with encouraging signs of future growth

• the emergence of new sectors of economic activity
• strong growth in service-sector jobs
• commercialisation of academic knowledge
• more young people entering FE/HE
• more recently, a stable macro-economic environment

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New jobs and activities

• Financial services
• Scotland 6th largest equity centre in Europe
• Biotechnology
• home to 20 of UK biotech companies, employing
  24,000
• Optoelectronics
• employs 5,000 people, 60 output exported
• Creative industries
• digital media, games, Edinburgh Festival injects
  120m annually

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More people entering FE/HE
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Some drivers of future economic change
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The changing nature of value in the economy

• Increasing importance of intangibles in
  creating value
• software, services (with products), speed,
  ideas/creativity, brands/trust, experience etc.

• New ways of doing business
• mass customisation eg Dell, Dulux
• knowledge management eg Skandia
• innovative business models eg Egg, e-Bay, Dyson
• brands and values eg Intel, Nike
• experience eg Disney

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A more global, networked economy

• differential cost of labour
• the end of the assembly plant era in Scotland
• much closer ties between national economies
• vulnerability to economic shocks
• a smaller, connected world
• agglomeration effects

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More demanding and prosperous consumers
Source ONS
From mass production to mass customisation
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People, skills and talent

• Importance of know how vs know what in the
  knowledge-based economy
• Future skills trends
• core skills basic skills communication skills
  problem-solving, planning and teamwork IT skills
• occupations managers public sector
  professionals elementary caring and service
  occupations
• Talent as key diversity as driver

Its not the strongest of the species that
survive, nor the most intelligent but the ones
most responsive to change Charles Darwin
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The rise of the creative class

• Richard Florida says innovation flourishes in
  places that attract creative people, places with
  the following attributes
• critical mass of cultural and natural assets
• open attitude to new and unconventional ideas and
  people
• cultural eco-system - many forms of creativity
  take root and flourish
• attract new and different kinds of people
• make rapid transmission of knowledge ideas easy
• have low barriers to entry economic, social,
  civic
• creativity drives innovation
• innovation is the key to sustained economic
  growth

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How can Scotlands communities become more
successful in the future economy ?
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Foster a supportive environment for enterprise

• more new and growing small businesses
• host to new/emerging activities eg social
  enterprise, digital media
• more diversified local economies
• exploiting academic knowledge
• no low-tech industries, only low-tech companies
• new sources of value not just high-tech
• importance of global connectivity

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Be home to diverse and adaptable people

• openness, willingness to change
• attracting, retaining - and losing - a diverse
  range of people
• new ideas and influences
• making the most of our human capital
• enthusiasm for learning - across all ages