Aquaculture sector - wider economic impacts: estimates

This study provides the estimates of the direct, indirect and wider economic impacts of the Scottish aquaculture sector for 2018, including associated tax receipt estimates.

1. Executive Summary

The aquaculture sector in Scotland is an important provider of employment in rural Scotland and represents the UK's largest food export by value. This study considered the wider value that the sector had to the Scottish economy and the source of these impacts

In 2018 the aquaculture sector supported 11,700 jobs in the Scottish economy and generated £885 million Gross Value Added

In 2018 the aquaculture sector had a turnover of £1.5 billion. The turnover of the sector included a significant amount of transactions within the sector itself, such as the purchasing of aquaculture products by the processing companies. From this turnover, the sector generated £468 million direct Gross Value Added (GVA). A further £359 million GVA was generated in the supply chain of aquaculture companies and £57 million through the spending of staff salaries.

Figure 1‑1 Turnover and Sector 2018 GVA by Source
The chart shows aquaculture sector turnover and GVA by source figures for 2018: Sector turnover  £1,483 m; Direct GVA £468 m; Supply chain GVA £359 m, Induced GVA £57 m and total GVA £885m

Source: BiGGAR Economics Analysis

The Aquaculture sector purchased 76% of its supplies from Scotland

The aquaculture sector spent £1.4 billion on supplies and capital investments in 2018. This includes spending taking place within the aquaculture sector. To avoid double counting, only the expenditure taking place outside the aquaculture sector was considered. This was estimated to be around £834.6 million in 2018. The single largest category of external expenditure was the purchase of feed for finfish production, which accounted for £290 million of spend. This was followed by expenditure on equipment and vessel rental, transport and veterinary services. The majority of these goods and services were purchased from Scotland.

Figure 1‑2 Share of Supply Spending in Scotland by Sector
Chart showing share of supply spending in Scotland by Sector. It’s highest for Real estate activities (100%) followed by Wholesale and retail trade (97%) and Arts, entertainment and recreation (81%).

Source: BiGGAR Economics Analysis

Staff costs accounted for 12% of the turnover of the aquaculture sector

In total, the aquaculture sector paid £185 million in staff costs in 2018. Staff costs accounted for a significant portion of the direct GVA of the sector and are less responsive to fluctuation in the output of the sector than other contributors of GVA, such as company profits. Over time staff costs have grown following both trends in the number of jobs supported by the sector and in the workforce skills. Many of these highly skilled jobs, particularly those in finfish production, are markedly higher paid than other employment opportunities in the rural communities of Scotland where this activity occurs and these jobs play an important role in attracting people and their expenditure to some fragile rural economies[1].

Figure 1‑3 Change in Staff Costs and Production of Salmon Producers (2010 - 18)
Chart shows the change in staff costs and production of salmon producers. Staff costs have been steadily increasing since 2013 despite fluctuations in salmon production.

Source: BiGGAR Economics Analysis of Salmon Company accounts

The vast majority of impact came from salmon farming and the processing of aquaculture products

The four subsectors that are included in this analysis are of varying scales and contribute to the overall impact of the aquaculture sector in different ways. In 2018 the majority of the GVA of aquaculture was from the salmon production subsector, followed by aquaculture processing. Combined, these accounted for 96% of the GVA impact of the aquaculture sector.

Figure 1‑4 Gross Value Added by Subsector in 2018
Chart shows gross value added by subsector in 2018. Salmon production £585m; Other finfish production £21m; shellfish production £10m; Aquaculture porcessing £269m; total sector GVA £885m.

Source: BiGGAR Economics Analysis

In 2018 the activities of the sector generated £94.1 million taxes paid to local, Scottish and UK Governments

The public sector benefits from the activities of the aquaculture sector through the tax revenues that it generates. It was estimated that in 2018 the sector contributed a total £94.1 million in taxation, including:

  • £47.4 million in Corporation Tax;
  • £18.1 million in Income Tax; and
  • £28.6 million in National Insurance Contributions.



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