Scotland slips down to ninth place in UK prosperity rankings

SCOTLAND has slipped down the UK’s prosperity rankings despite a rise in average earnings, new research has suggested.

London was again rated the most prosperous part of the UK, followed by the South East of England, while Scotland fell by two places to ninth on the list

The third annual UK Prosperity Map produced by Barclays Wealth and Investments also rated Eastern England, Northern Ireland, the East Midlands, the South West, West Midlands and the North West as being more prosperous than Scotland.

Wales and the Yorkshire and the Humber region were both ranked below Scotland while the North East was ranked bottom of the list.

John Godfrey, director for Scotland at Barclays Wealth and Investments, said: “The last twelve months have seen fluctuations in the UK and Scottish economies, and this is reflected in the mixed picture of prosperity growth across the country in this year’s prosperity map.”

It is only the third time the research, which considers a range of indicators to measure prosperity, including the number of millionaires living in each area, average earnings, business growth rates, house prices and GDP per capita, has been carried out.

In Scotland, a 1.5% increase household expenditure reflected the rise in average earnings – which were up 2.5% to £27,032, giving the country the third-highest earnings outside London and the South East.

While consumer spending in Scotland rose by 9% over the year, it was still 5% lower than the average for the UK.

Meanwhile, the 2017 Prosperity Map showed some 30,500 millionaires lived in Scotland, with this total remaining steady.

House prices in Scotland rose by just 2% over the year, with the increase lagging behind the UK, while the business birth-to-death ratio – which measures the number of jobs created by new businesses over a period against the number of positions lost as companies close down – was the lowest in Britain.

Mr Godfrey said: “It’s encouraging to see that people in Scotland are benefiting from falling unemployment and higher earnings, and that we have retained our GDP ranking, delivering the fourth highest per capita in the UK.

“Household spending is up but some measures like house prices are showing slower growth than the rest of the UK.

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“Interestingly, business birth-to-death ratios appear to indicate reduced start-up activity. Our entrepreneurial community play a key role in wealth generation.”

Paul Swinney, principal economist at the Centre for Cities think tank, said: “Overall, this year’s UK Prosperity Map shows that the greater South East is still outperforming the rest of the country economically, based on its ability to attract in high-skilled business investment.

“While other areas of the country have benefited from falling unemployment, rising prices have softened the positive impact of increased wages.”