finance

Post-pandemic work trends could see Scottish city employment rise by 7%



Major Scottish cities are predicted to see employment rise by as much as 7%, following the pandemic changing in the way people work, according to KPMG.

A new report also suggested that businesses in some sectors are preparing for employees to spend two to three days a week working from home on a permanent basis.

The professional services group claims that this could see existing office space capacity potentially increase by as much as 40%.

The increased availability of office space in major business hubs is expected to attract businesses from smaller areas to fill up the vacant space, with cities like Glasgow, Edinburgh and Aberdeen set to see employment rise by between 5 and 7%.

Smaller towns and cities with a large proportion of the workforce working partially from home are also expected to benefit.

Areas including East Dunbartonshire, Clackmannanshire and East Renfrewshire are all expected to see local demand grow with greater numbers now working from home on a regular basis.

Meanwhile, less dense business areas could see a decline in employment and may need to be transformed into more residential, leisure, retail and other uses.

As the business landscape consolidates, KPMG analysis also found the change could boost overall UK labour productivity by 0.5%, due to businesses being able to tap into a larger pool of workers, suppliers and clients.

The report examined how local high streets in residential towns and neighbourhoods were expected to reap the rewards of greater home working through increased demand by residents during the week.

However, the impact on high streets across the UK is unlikely to be uniform.

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Some places may be hit relatively hard by the loss of office workers due to their proximity to a larger business hub, which may be compounded by the loss of commuter footfall among remaining employees due to the prevalence of working from home.

James Kergon, senior partner in Scotland at KPMG UK, commented: “Over time, the shift in business location could support the rise of several commercial hubs across Scotland – the increase in the concentration of firms and workers has the potential to make those companies located there more productive and enable these areas to serve as the engines of economic growth.

“Cities like Glasgow, Edinburgh and Aberdeen all stand to benefit from the consolidation of business locations, so they will need government to work closely with local leaders to ensure the transition is smooth and any barriers to growth are quickly ironed out.”

Yael Selfin, chief economist at KPMG UK, said: “As people spend more time working from home and less time in the office, we could see a revival of the local high street.

“They will need to transform into places of purpose to meet demand for community-based services, hospitality, culture, as well as retail.

“This transformation will require local government, residents and businesses to work together to map their future shape and make concrete plans to support and enable the necessary changes to make the most of the new post-Covid business reality.”

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