Natural capital: regional economic reliance analysis

6. Glasgow City REP

Glasgow City Regional Economic Partnership's economy relies on nature from fishing and forestry to the way the environment regulates weather and climate and supports tourism and recreation. Understanding this helps us realise how important nature is to jobs and business today, and how investing in natural capital can bring about future economic benefits. £10bn of Glasgow City’s output is annually supported by natural capital alongside an estimated 60,200 full time equivalent (FTE) jobs.

Top 5 industries accounting for the largest share of natural capital reliant economic activity are:

• Electricity: 41% reliant
• Water and sewerage: 8% reliant
• Agriculture: 4% reliant
• Gas and air conditioning: 3% reliant
• Retail excl. vehicles: 3% reliant

Estimated employment supported by natural capital in these industries:

• Electricity: 11,400 FTE
• Water and sewerage: 3,300 FTE
• Agriculture: 800 FTE
• Gas and air conditioning: 800 FTE
• Retail excl. vehicles: 5,200 FTE

The percentage of economic activity and jobs supported by nature that cannot be replaced by engineering solutions are:

• Electricity: 84%
• Water and sewerage: 86%
• Agriculture: 59%
• Gas and air conditioning: 100%
• Retail excl. vehicles: 87%

Glasgow City REP's natural capital reliant output and employment is dominated by the electricity industry, as the city represents a key location for companies' head offices. The activity associated with this industry is heavily dependent on natural capital located across rural areas of Scotland, though the jobs within this sector located in Glasgow are nonetheless still reliant on natural capital. Outside of the city, the REP includes Lanarkshire's historic woodland, and moorland within Inverclyde's Clyde Muirshiel Regional Park, both of which form important habitat networks. 25% of Scotland’s natural capital reliant output is based in Glasgow City REP.

To better understand the Glasgow City REP’s natural capital reliant output and employment, we can compare the data to ‘traditional’ economic measures from the National Accounts, which this analysis is based on. Using the National Accounts Glasgow City’s ‘traditional’ output is £84bn and 884,200 FTE jobs, while this model measures nature reliant output at £10bn and 60,200 FTE jobs. Some of this value of nature will be already reflected within the economic data, but some of nature’s value might be partially or not at all reflected in market prices, therefore part of the £10bn is included in the £84bn, but not all.

Key considerations:

• Glasgow is the location of various companies' head offices, which results in some of the natural capital reliant economic output being attributed to Glasgow City REP, despite the natural capital not being located there - this is particularly visible for renewable energy. Most renewable electricity is generated from onshore wind; some fields are located within Glasgow’s REP, whilst others are distributed across South of Scotland, Aberdeen City and Shire, and Highlands and Islands REPs.
• Whilst the analysis does not focus on non-renewable energy, due to environmental harm, the amount these industries purchase from renewable industries is picked up as economic dependence on natural capital. This explains why sometimes non-renewable industries are shown as natural capital reliant, such as ‘Gas and Air Conditioning’ economic activity in this case.
• The importance of Glasgow City as a hub for retail is visible in the data as well.