International competitiveness: overview

Indicators of Scotland’s relative competitiveness

34. Given that the evidence on competitiveness points to a wide range of drivers, Scotland’s National Performance Framework^[33] assesses Scotland’s performance against a wide range of social, economic, cultural, and environmental factors. Such factors are tracked via the Scottish Government’s National Performance Framework and National Strategy for Economic Transformation Annual Reporting.^[34] For example, Scotland is in the:

• 1^st quartile for tertiary education (UK and OECD)
• 1^st quartile for foreign direct investment (UK)
• 2^nd quartile for productivity (OECD)
• 2^nd quartile for research and development (R&D; OECD)
• 3^rd quartile for early-stage entrepreneurism (OECD)
• 4^th quartile for exports (OECD)
• 4^th quartile for investment (Gross Fixed Capital Formation; OECD)

35. Within the UK context, Scotland’s productivity is close to the UK average and outperformed all regions of the UK over the 1999-2019 period.^[35] As shown in the EY data above, performance in terms of attracting inward investment projects has been consistently strong. The HMRC research finds net migration of workers from the rest of the UK to Scotland, boosting tax receipts. Challenges remain, however, with respect to the supply of labour, especially for key skills groups. The Scottish Government will continue to monitor Scotland’s competitiveness going forward.