Herald Forum

It is the most upbeat assessment of what, for generations, has been arguably the UK's most depressed economy.

A new report which will underpin Glasgow's future economic strategies claims the city has shed the shackles of the past and is ready to take advantage of the knowledge and service economies. Miles Better, it could be said, even if it is a quarter of a century since the famous marketing phrase was first coined.

For a city weary of the burden of downcast socio-economic profiles and projections, but aware of its place in the world's industrial history, it is quite a proclamation to take on board: "The influence of factors that led to Glasgow's decline in the post-war period are coming to an end."

The crucial 22-44 age group has risen by 40% in 20 years, the dramatic decline in manufacturing is now being matched by a trebling of employment in finance and business sectors, while the benefits-dependent population is finally on the wane.

The report is the result of an investigation by the city council's development and regeneration department, with input from the Centre for Population Health, and is designed as the basis for future schemes on worklessness, training and economic development.

While Glasgow's post-war history is a classic case study of industrial decline, the report claims to have a "better understanding" of the factors which conspired to disadvantage Glasgow in the 1970s and 1980s.

Chief culprits were the population migrations to the new towns and Glasgow's failure to diversify when manufacturing declined.

In 1971, just 22% of Glasgow's population was aged between 25 and 44, the crucial age group if an area is to take advantage of economic opportunities, compared with 33% in Cumbernauld and Bishopbriggs.

Where other cities such as Manchester and Newcastle, and even neighbours like East Kilbride, had diversified into chemical and electrical engineering, Glasgow failed to adapt. In 1987, just 6.8% of Glasgow's manufacturing jobs were in these sectors, compared with 33.4% in Newcastle and 24.1% in East Kilbride.

This double disadvantage led to the growth of multiple-deprived areas. As recently as 1996, only 55% of the resident population were in employment, compared to a Scottish rate of 70%, while a massive 143,000 people were dependent on benefits.

However, as rapid as the post-manufacturing decline, Glasgow's pace of change has been well in excess of comparable areas. By 2005, 66.2% of Glaswegians were in employment, still lower than the Scottish rate but representing an additional 48,000 employed.

The city still has an in-commuting workforce of almost half. Their consumer expenditure is predominantly elsewhere, further explaining economic weaknesses in the 1980s.

BUT, according to the report, the healthy nature of the housing market in Glasgow itself may be an indication many of the negative aspects of this may be coming to an end. It also claims there is evidence the buoyant labour market, mainly the retention of a younger working-age population and creating employment which "thrives in a city environment", is reducing deprivation.

However, there is a warning that having a thriving conurbation and a regional economy now dominated by Glasgow city centre is "papering over cracks" in some areas surrounding the city.

Ahead of tomorrow's council meeting, when the report will be presented, several elected members expressed enthusiasm for its findings. George Redmond, chairman of the policy development and scrutiny committee of development and regeneration services, said: "This research proves Glasgow has turned the corner, where the influences that led to the city's post-war decline are all but at an end.

"There are more people available for work and, perhaps more importantly, we've lifted tens of thousands out of poverty and back into employment."

Council leader Steven Purcell said: "No longer can Glasgow be described as an economic also-ran. That is testament to the remarkable physical and social transformation the city is enjoying. From our financial services to culture and art, young professionals are choosing Glasgow as their lifestyle destination of choice."

But while the city's politicians are crowing about an undeniably positive report, others urge caution over the sustainability of shopping and call centres to prop up an economy.

Professor Ivan Turok, an expert in urban regeneration at Glasgow University, said the picture was far from as positive as "crude numbers" would suggest, claiming benefits claimants could be moved around the system and that Glasgow had few, if any, major headquarters of large companies. He added: "If we're going to invest more, we need to address derelict land and improving the employability of the 100,000 still claiming benefits, especially with more eastern Europeans joining the labour market.

"There are also questions about the cost of Glasgow's recovery to some of the surrounding towns, especially as regards retail."

Respected economist Jim Stevens, of Strathclyde University, also tempered the enthusiasm: "It's fine saying a buoyant economy will trickle down to the most deprived but there are still about 100,000 claiming benefits. What it says is the underclass isn't as big as it was.

"Literacy and numeracy levels are just not satisfactory and we need to think big rather than waiting for the benefits to flow down. The only jobs for tens of thousands of people are low-paid and low-skilled and breaking that perpetual cycle of deprivation is the big challenge."

Dr Carol Tannahill, of the Glasgow Centre for Population Health, agreed the picture was far from perfect but believed the situation was encouraging. She said the next challenge, now the economy was in a healthier state, was to address health statistics.

Dr Tannahill added: "The data here seems accurate and reliable and reflects the positive changes in the last few decades. It may still take a generation for prosperity to filter down. But the health statistics are not yet catching up with the economic statistics."