Around 1,400 jobs in oil and gas based in Aberdeen are expected to be lost in the next three years, according to a new report.
Professional services firm EY has issued a 2019 forecast for Scottish economic growth.
The report states that employment in Aberdeen is expected to fall by an average of 0.1% annually between 2018 and 2021, with oil and gas being the “hardest-hit” sector.
EY estimates 1,400 jobs will be lost in the sector within that period.
Meanwhile employment is expected to fall in 2018 across the city, with 3,000 jobs to be shed in total.
However, the report says last year saw an overall rise in employment in the Granite City by 0.8%, which is the equivalent of 1,500 jobs.
Gross value added (GVA) – the measure of the value of goods and services produced in the area – is expected to remain flat this year, but recovery is “likely” for the city from 2019 onwards.
EY estimates GVA growth will be 1.1% per year between 2018-2021, falling just short of the average for Scotland as a whole.
Derek Leith, EY office managing partner in Aberdeen, said: “It is encouraging to see a more positive trajectory for the Aberdeen economy beginning to emerge with both GVA and employment growth predicted to significantly improve in the next few years. Between 2015 and 2018 the city’s GVA growth averaged -1.4% but over the course of the next three years (2018 to 2021) that is expected to increase to 1.1%. Meanwhile city employment growth is set to rise from -1.9% to -0.1% for the same time periods.
“This is by no means a full recovery for the Aberdeen economy, annual GVA growth of 1.1% is good news representing a long awaited return of an upward trend but this still trails the Scotland average. Job creation, investment in skills and business investment remain top priorities for Aberdeen and Scotland.”