6. Impact on the Wider Economy
6.1 This section looks at the wider impact on the local economy of the station reopening. It considers factors such as population, the housing market and the labour market.
6.2 Chapter 4 on the Outcome Evaluation included details of the counterfactual, i.e. what users of the station would have done, in terms of their travel choices, if the station had not reopened.
6.3 The purpose of this section is to discuss and present the findings of the analysis undertaken to measure how the station has impacted on the local economy. It is important to also understand the counterfactual in these circumstances, i.e. what would the economic impact on the local area have been if the station had not been reopened. Identifying and isolating the impacts of a transport scheme is a challenging process as there are likely to be a number of factors acting simultaneously which have contributed to the outcomes. To account for this we have defined ‘control group’ areas where the impacts in these areas can be compared against those in Laurencekirk. The aim of selecting control groups is to help understand whether any impacts that have occurred locally in Laurencekirk have been directly due to the reopening of the new rail station. It does this by comparing impacts against areas that have faced similar economic experiences, therefore isolating the impact of the station and using it as a differentiating factor. While the approach applied in this context is not perfect, it is regarded as reasonable within the principle of proportionality emphasised in STAG.
6.4 The control groups adopted for this study were the wider Aberdeenshire area and national averages i.e. Scotland as a whole. The reason for selecting Aberdeenshire is to consider a wider group of similar areas i.e. factors affecting local areas in Aberdeenshire will be common to both groups, with the reopening of the station being the key isolating factor. Similarly, considering Scotland as a whole will, again, mean that both groups are likely to be affected by similar impacts, with the impact of the station being an important differentiating factor.
6.5 For each measured output (see below), the trend in the Mearns and Laurencekirk area has therefore been compared against the Aberdeenshire and Scottish averages over the same period.
6.6 There is a limited number of socio-economic factors that are collected and can be compared across these areas. However, the outputs for which the comparisons were drawn were:
- house prices, sales, and completions; and
- benefit claimants and Jobs Seekers Allowance claimants.
6.7 It is often claimed that a new rail line or station will, over time, increase the population of surrounding settlements by virtue of improved accessibility. This is likely to vary depending on the extent of the travel-to-work market, service frequency, access to services, available substitutes etc. It will also be dependent on the length of time since the station was reopened, with, other things being equal, the longer the period since the station was opened resulting in a greater increase in population. While the impact on population size may take longer than five years to materialise (due to the planning and development time required to supply the necessary housing) we have analysed population change over time to identify whether there are any noticeable trends.
6.8 The General Register Office for Scotland produces mid-year population estimates for settlements in Scotland. The change in population in Laurencekirk over the period 2004-2010 according to this data (most recent available) is shown in Figure 23 below.
Figure 23. Percentage change in Population 2004 - 2010
6.9 As shown, the rate of population growth has been far quicker in Laurencekirk, growing by 36% between 2004 and 2010, compared to that of Aberdeenshire (6%) and Scotland as a whole (3%). Between 2004 and 2008, i.e. before the station reopened, the growth in population in Laurencekirk was 25%, compared to 4% and 2% in Aberdeenshire and Scotland respectively. Between 2008 and 2010, i.e. after the station reopened, the growth in Laurencekirk was 9%. This compares with growth of 2% in Aberdeenshire and 1% in Scotland as a whole. Therefore, while the population growth in Laurencekirk post the reopening (or in anticipation of the reopening) was much higher than in Aberdeenshire or Scotland as a whole, this appears to be a continuation of the growth which was being experienced prior to the station reopening rather than the station itself. It should be emphasised that the 2010 figures will not provide a true reflection of the impact however, as it is too soon after the station reopened, and this should be revisited when further figures become available.
6.10 This pattern of growth is also evident at the ‘intermediate geography’ (IG) level which forms the basis of reporting for much of Scottish Neighbourhood Statistical releases. Laurencekirk station is located in the IG ‘Mearns and Laurencekirk’ and the change in population for this area over the 2001-2011 period is shown in Figure 24 below.
Figure 24. Percentage change in Population 2001-2011
6.11 The population of Mearns and Laurencekirk increased by 22% between 2001 and 2011 while, over the same period, the population of Aberdeenshire grew by 9% and Scotland by 4%. However, between 2001 and 2008 the population growth in Mearns and Laurencekirk was 15%. Indeed growth of 15% was experienced between 2003 and 2008. The growth between 2008 and 2011 was 7%. Again, the figures suggest that the population growth post 2008 was very much a continuation of the relatively high rate of growth experienced in the years prior to the station reopening, rather than the impact of the station reopening itself. Further, looking at other areas in Aberdeenshire, the high rate of growth pre and post 2009 is not unusual. While the average for the area was 6% and 3% respectively, there were parts of the local authority area which witnessed levels of growth in excess of Mearns and Laurencekirk.
6.12 The Mearns and Laurencekirk areas have been experiencing high population growth relative to Aberdeenshire and Scotland. However, the growth post 2008 could easily be a continuation of the strong growth witnessed prior to the station reopening and the evidence is therefore inconclusive.
Housing / House Sales
6.13 Information on house sales at the intermediate geography level is available through Scottish Neighbourhood Statistics. Figure 25 below shows the change in the house sales in Mearns and Laurencekirk between 2003 and 2011 as recorded in this dataset.
Figure 25. Percentage change in number of House Sales 2003-2011
6.14 The figure shows a fairly similar pattern across the three areas, with the downturn in sales post 2007 following the trend in economic activity over the same period. Between 2007 and 2011, the number of house sales in Mearns and Laurencekirk declined by 51%. This compares with figures of 59% and 35% for Scotland as a whole and Aberdeenshire respectively i.e. the decline was less than that witnessed across the country generally but much higher than in Aberdeenshire as a whole. The figures from 2008 show a similar trend, with declines of 14%, 23% and 36% for Aberdeenshire, Mearns and Laurencekirk and Scotland respectively.
6.15 Data on house sales at the settlement level is available from Zoopla Property Search. Figure 26 below shows the change in the number of house sales for Laurencekirk between 2006 and 2013 compared to the average for the ten settlements in Aberdeenshire with population levels most similar to that of Laurencekirk.
Figure 26. Percentage change in number of House Sales 2006-2013
6.16 As shown the number of house sales in Laurencekirk, similarly to the average, fell between 2006 and 2010, with the 2010 figure around 60% of the 2006 figure in both areas. Laurencekirk did witness a large increase in 2011, however this was followed by a relatively large decline in 2012 and a large increase in 2013.
6.17 Overall, while there was a difference in the pattern of growth in house sales in 2011 there is no clear evidence that the reopening of the station has had a measurable impact on the pattern of house sales in Laurencekirk.
6.18 Figure 27 shows the percentage change in median house prices in Mearns and Laurencekirk, Aberdeenshire, and Scotland over the period 2001-2011.
Figure 27. Percentage change in median house prices 2001-2011
6.19 Median house prices across the three areas grew steadily between 2001 and 2008. The growth in house prices over that period was 195% in Mearns and Laurencekirk. The figures for Aberdeenshire and Scotland were 171% and 130% respectively, largely reflecting the strong growth in the housing market across Scotland and the UK.. Post 2008, Laurencekirk and Mearns has witnessed a more volatile pattern of increases and declines compared to the more steady prices witnessed across Scotland as a whole. Between 2008 and 2011 median house prices have declined by 16% in Mearns and Laurencekirk. This compares with figures of 3% decline for Aberdeenshire as a whole, and a fall of 1% across Scotland. Again, these trends reflect the trend in house prices across the country following the onset of the economic downturn (and burst housing ‘bubble) following the financial crisis in 2008.
6.20 Overall there is no clear evidence that the reopening of the station has had a significant impact on house prices in the Laurencekirk area.
6.21 Aberdeenshire Council publishes data on the number of housing completions for each settlement within the authority in their Housing Land Audit.
6.22 Figure 28 below shows the percentage change in the number of completions in Laurencekirk, Kincardine and Mearns, and Aberdeenshire as a whole.
Figure 28. Percentage change in Completions 2007 - 2012
6.23 The figure shows that the number of completions in Laurencekirk has been much more volatile than the control areas. However, this is not surprising given the smaller size of the area meaning that a small change can result in fairly large swings and volatility in the totals. Perhaps more importantly is the noticeable sharp decline in completions in Laurencekirk post 2007 compared to the other areas. This extends into 2008, 2009, 2010 and 2011. While this is not surprising given the impact of the economic downturn on the housing industry, it does suggest that the station reopening has had limited impact on the number of completions in the local area.
6.24 Figure 29 below shows the percentage of the working age population claiming ‘Key Benefits’ as defined in the Scottish Neighbourhood Statistics. A decline in the level of benefit claimants since the reopening of the station in 2009 could suggest that the improved accessibility to, for example, Aberdeen offered by the new station facility has increased opportunities for the workforce. In addition, the reopening of the station could also have helped to promote more activity locally and created job opportunities in Laurencekirk.
Figure 29. Percentage of working population claiming Key Benefits
6.25 The proportion of the population claiming key benefits in Mearns and Laurencekirk has, in recent years, in the main been lower than that of Aberdeenshire and Scotland as a whole. In 2001 the figure for Mearns and Laurencekirk stood at 9.7%. This compared with figures of 9.5% for Aberdeenshire and 18.5% for Scotland as a whole. Between 2001 and 2012 the numbers claiming benefits declined by 35% in Mearns and Laurencekirk. This was significantly higher than that witnessed in Aberdeenshire and Scotland as a whole, where falls of 12% and 14% respectively occurred over the same period.
6.26 More specifically, between 2001 and 2008 the number of claimants in Mearns and Laurencekirk declined by 33%. Between 2008 and 2012 the reduction was just over 3%. While the reduction between 2001 and 2008 was lower in Aberdeenshire and Scotland (5% and 3% respectively), it was higher between 2008 and 2012, with figures of 7% in Aberdeenshire and 4% in Scotland as a whole. This tends to suggest that the station has had limited impact on the number of key benefit claimants in Mearns and Laurencekirk.
6.27 Figure 30 below illustrates the trend in the percentage of the working age population claiming Job Seeker’s Allowance each year between 2001 and 2012.
Figure 30. % of Working Age Population claiming Job Seeker’s Allowance
6.28 While there are clear annual fluctuations over the period, the three areas experienced a general decline between 2001 and 2007 during a period of strong economic growth. While the figure in Scotland fell from 3.2% to 2.0% and in Aberdeenshire from 1.3% to 0.7%, over the same period it declined by 2.4% to 0.9% in Mearns and Laurencekirk.
6.29 Post 2008 saw a significant initial increase across all areas, followed by a fall between 2009 and 2012. Figure 30 shows that there was a much larger fall between 2009 and 2011 in Laurencekirk than in Aberdeenshire or Scotland as a whole. However, between 2011 and 2012 the number increased in Mearns and Laurencekirk, while it declined in the other two areas.
6.30 Overall, there is no clear evidence to suggest that the reopening of the station has had an impact on the number of benefits claimants in Mearns and Laurencekirk, with greater reductions in Aberdeenshire and Scotland from the date when the impacts of the station are likely to have begun.
6.31 Overall there is no clear evidence from the data examined that the reopening of the station at Laurencekirk has had a significant and measurable wider economic and social impact. While there have been some positive impacts across a number of the metrics considered in, for example, the housing and labour markets, the impacts in Laurencekirk post station reopening do not appear to be significantly different from those witnessed in other areas considered. In addition, some of the positive trends, for example population, tend to be continuations of what was being experienced prior to the station reopening.
6.32 While there is little evidence to suggest that the reopening of the station has had wider positive social and economic impacts, it must be noted that the impacts of the station may not have firmly bedded in and it may take a longer period for these to materialise. In addition, some of the economic and social data is not yet readily available e.g. census data. It may require some time before the data becomes available for analysis and firm conclusions can be reached. Until then the findings of this section on wider impacts should be seen as preliminary.