Potential scale of Scottish seaweed-based industries: research paper

8 Wider socio-economic impacts under the projected future scenarios

8.1 Overview

8.1.1 This section presents the findings of the wider socio-economic impacts that could arise as a result of the development of the industry, under the different scenarios. The socio-economic impacts are presented in four subsections: GVA impacts, employment impacts, regional impacts and social impacts. It includes both the direct and indirect effects on the economy as well as any other wider effects on the economy

8.1.2 Whilst the complete methodology employed to undertake this socio-economic assessment is set out in Appendix F (Sections F.4 and F.5), a brief summary is presented here. Under both scenarios, projected turnover for the industry has been developed up to the year 2040. GVA effect and employment effect multipliers have been used to estimate the GVA value of the seaweed industry and its supply chain to the Scottish economy and the maximum number of FTE supported by the industry. Specifically, the multipliers capture the following:

• GVA effect multipliers estimate the value of goods and services to the economy from the seaweed industry and its supply chain (Type 1: direct and indirect effects) and the spend by people employed directly and indirectly in the seaweed industry and its supply chain on local goods and services (Type 2: Induced effects); and
• Employment effect multipliers estimate the number of FTE supported by the seaweed industry and its supply chain (Type 1: direct and indirect effects) and the number of FTE supported through the additional spending (Type 2: Induced).

8.1.3 The resulting estimates of GVA and FTE jobs have then been applied to projections of the Scottish economy to estimate the proportion of GVA that the seaweed industry would represent and its likely impact on the number of unemployed people in Scotland.

8.1.4 Following this, two illustrative area-based scenarios have been developed to assess what the impacts could mean at a local level . This, on the one hand, illustrates the importance of choosing one location over another and, on the other, helps to assess the scale of impacts (both positive and negative) if the industry were to cluster within a community. In practice the degree of impacts presented within the case studies would depend on the extent to which the communities are able to realise these opportunities. Specifically, it has been assumed that industry concentration within each community is 25% (with the remaining 50% being evenly spread and located elsewhere in Scotland). This % concentration was selected as a potential threshold to consider both positive and negative impacts on a community (from this it follows that a smaller concentration may have a smaller effect that is difficult to detect).

8.1.5 The social impacts are assessed using social clusters, which are groupings of impacts intended to capture those effects that have been identified as being most significant to individuals and communities, and which align with national indicators and sustainable development goals from Scotland's National Performance Framework. The approach of assessing social impacts using social clusters has previously been used to assess the impacts of offshore renewables on Scottish communities^[29]. Social impacts are described, and a rating has been assigned to enable comparison of the expected magnitude of impacts. The ratings range from (as shown in Table 19):

• Major negative (- - - -), which is associated with impacts that are expected to have a noticeable effect that is sufficient to cause complaints or protests from the community through to
• Major positive (+ + + +), which is defined as having a noticeable effect that supports new services or activities within the community.

Table 19 Ratings for use in the socio-economic impact assessment

Negative impacts (-)	Positive impacts (+)
Major (- - - -): sufficient negative impacts predicted to have a noticeable effect that is sufficient to cause complaints and/or protests from the community	Major (+ + + +): sufficient positive impacts predicted to have a noticeable effect that is sufficient to enable new services or activities within the community
Moderate (- - -): sufficient negative impacts predicted that result in concerns being raised by the community	Moderate (+ + +): sufficient positive impacts predicted that result in increased levels or expansion of existing activities or services
Minor (- -): negative impacts predicted that may be noticed but which are accepted by the majority of the community	Minor (+ +): positive impacts predicted that may be noticed but which support existing services or activities but not the extent that they can expand
Negligible (-): small negative impacts that are unlikely to be noticed by the majority of the community	Negligible (+): small positive impacts that are unlikely to be noticed by the majority of the community
Neutral/no overall impact (0)

Notes: Based on work undertaken by RPA with ABPmer for a series of socio-economic impact assessments undertaken for Scottish Government and Marine Scotland.

8.1.6 There is limited research on the potential social impacts of the seaweed-based industry within the UK (examples include Billing et al 2020 (social licence and seaweed farming) and Gegg and Wells, 2019 (public perception of macroalgae for biofuel production))^[30]. As such, the social impacts in this study are only considered at a relatively high level (based on the methodology described in Appendix F) and would benefit from further attention as the sector develops and/or a strategic plan for the sector is prepared. Furthermore, It should be noted that the social impacts presented in this section are not informed by stakeholder consultation, which was outwith the scope of this study.

8.2 GVA Impacts

8.2.1 This subsection sets out the projected economic impact of the Scottish seaweed industry, under both the BAU and higher growth scenario. The discussion covers both seaweed production and seaweed products, hereafter known as the 'Scottish seaweed industry'. For a more detailed explanation of the methodology, see Appendix F (Sections F.4 and F.5).

8.2.2 Overall, the Scottish seaweed industry is expected to contribute the following to the economy by 2040:

• Under the BAU scenario, the Scottish seaweed industry and its supply chain are expected to contribute £11.5 million in GVA to the economy by 2040. The increase in income for employees associated with the seaweed industry and its supply chain as a result of higher demand for seaweed, i.e. Type 2 effect, is expected to contribute a further £1.9 million to the economy by 2040. Overall, this means that the Scottish seaweed industry is expected to contribute £13.4 million per year to GVA in Scotland in 2040. For context, this could represent a total of 0.007% of Scotland's GVA^[31].
• Under the higher growth scenario, the seaweed industry and its supply chain in Scotland is estimated to contribute £38.5 million to the Scottish economy by 2040. The subsequent spending from higher income for employees of the seaweed industry and its supply chain is estimated to contribute a further £6.6 million. Overall, this means that the Scottish seaweed industry is estimated to contribute £45.1 million per year to Scotland's economy in 2040, in terms of GVA. For context, this represents 0.025% of Scotland's estimated GVA in 2040^[32]. By comparison, fishing and aquaculture represented £485 million, or 0.34% of total GVA in Scotland in 2018^[33].

8.2.3 Table 20 summarises the results of the analysis. As it can be seen, the high growth scenario would contribute an additional £31.7 million per year to the Scottish economy.

Table 20 Summary of GVA effects per year by 2040

Impact	BAU scenario	Higher growth scenario
Type 1 GVA effect	£11.5 million	£38.5 million
Type 2 GVA effect	£1.9 million	£6.6 million
Total GVA effect	£13.4 million	£45.1 million

Rounding may lead to figures not summing exactly in some cases.

8.3 Employment Impacts

8.3.1 This subsection sets out the projected employment impact of the Scottish seaweed industry, under both the BAU and the higher growth scenarios. It should be noted that employment impacts are given as the maximum number of FTEs in any one year. For a more detailed explanation of the methodology and the relevant assumptions, see Appendix F (Sections F.4 and F.5).

8.3.2 The level of skills required to fill these jobs may vary depending on the stage of the supply chain, for example with higher skills requirements for some processing jobs but fewer skill requirements for cultivation and harvesting. There is the potential for harvesting jobs to be seasonal too, which can benefit specific age groups, such as those in the younger age groups. There is also the possibility of in-migration to take up jobs, which may be more likely in island communities than mainland communities. Some illustrative case studies of social impacts on an island and mainland community are provided in Section 8.4 but should be treated as indicative only, as the exact impacts on the communities will depend on employment levels and skill-set of the baseline workforce.

8.3.3 Under the BAU scenario, it is expected that the number of jobs within the seaweed industry and its supply chain will grow from an estimated 40 FTE per year in 2021 to 130 FTE per year by 2040. Moreover, once the subsequent impacts of spending in the economy are taken into account, (Type 2 effect) it is estimated that a further 30 FTE jobs per year will be supported in the wider economy by 2040. As such, between 130 and 160 FTE jobs per year are expected to be supported by the seaweed industry in 2040. This could represent a 0.14% decrease in the number of people unemployed in Scotland by 2040^[34].

8.3.4 Under the high growth scenario, it is expected that the number of jobs within the seaweed industry and its supply chain will grow from an estimated 40 FTE jobs per year in 2021 to 400 FTE jobs per year in 2040. Furthermore, once increased household income and ensuing spending within the economy is taken into account, it is estimated that a further 90 FTE jobs per year will be supported in the wider economy in 2040. Overall, a between 400 and 490 FTE jobs per year is expected to be supported through the seaweed industry by 2040. This could represent a decrease of 0.43% in the number of people unemployed in Scotland by 2040^[35].

Table 21 Summary of employment effects per year by 2040

Impact	BAU scenario	Higher growth scenario
Type 1 employment effect	130 FTE	400 FTE
Type 2 employment effect	30 FTE	90 FTE
Total employment effect	160 FTE	490 FTE

Rounding may lead to figures not summing exactly in some cases.

8.4 Regional impacts: two illustrative examples

8.4.1 The impacts from the scenarios will have different implications depending on where the industry is located. Although at national level, the impacts are expected to be small or moderate at most, local impacts could be significant should activity be located in smaller rural communities.

8.4.2 This subsection presents the results of two illustrative case studies, based on an island community and a mainland community, with different baseline population and employment levels. These case studies are intended to provide insight into the potential impacts on representative communities within Scotland and are modelled on real locations but should not be interpreted as potential sites for industry location in the future. The two communities that have been developed are distinct in their characteristics in terms of population, location, employment, size of economy and community.

8.4.3 For the purpose of estimating impacts, it has been assumed that jobs are fully retained within the community. Naturally, the degree to which a given community would benefit from the seaweed industry would depend on the concentration of industry within that community and the extent to which jobs are retained locally. Moreover, it has been assumed for the purpose of estimation, that jobs are taken up by local people and no displacement occurs (in other words, new jobs are filled in by the unemployed). However, the extent of impacts may differ in reality depending on whether migration is required to fulfil the jobs created by the industry. It should be noted, social costs and benefits associated with migration for seaweed-based jobs are outlined in the social impact Section 8.5.

8.4.4 Case study A: Impact from seaweed industry in small Island community

This case study illustrates a small community (over 23,000 people) over a large geographical area. There is a high proportion of self-employed and micro-enterprises are common. The share of the population by age group is larger for the over 65s than the national average and gross weekly earning lower than the national average. The unemployment rate is 3% and nearly half of the population are economically active.

Under the Business as Usual Scenario, and assuming 25% of the seaweed industry develops within the community, it is estimated that GVA will increase by around 0.5% by 2040. There will be reduced unemployment, with a decrease of around 12%.

The Higher Growth Scenario will have more significant impacts, with an estimated reduction of 36% in the number of people unemployed. Most of these impacts will be direct and indirect impacts (Type 1 multiplier effects^[36]). The GVA could be expected to grow by 1.6% from its projected £690 million in 2040 (this compares well against the estimated 0.5% increase estimated under the BAU scenario).

8.4.5 Case study B: Impact from seaweed industry in a mainland community

This case study illustrates a bigger mainland community of 74,000 where the number of people active are 34,000 and the unemployment rate is 5%. The local GVA is £1.7 bn. This is still a rural community, but there is a smaller proportion of self-employed and micro-enterprises, with some large enterprises. The average weekly earnings are higher than in case study A but still below those in the cities.

Under the Business as Usual Scenario, and assuming again that 25% of the industry concentrates within the community, it is estimated that GVA will increase by around 0.2% by 2040. There will be reduced unemployment, with a decrease of around 3% by 2040.

The Higher Growth Scenario will have moderate impacts, with a reduction of 8% in the number of people unemployed. GVA is estimated to grow by 0.7%. Due to the larger size of the community in case study B compared to case study A, the impacts are expected to be less noticeable at a community level.

8.4.6 The case studies indicate that the impacts on both communities differ by a significant degree, and impacts are more significant in the island community than in the mainland community, with significant reduction in unemployment rate under the higher growth scenario. This shows how location may be a key aspect to consider and how the industry can be beneficial to specific communities when the priorities are to boost employment in a particular local area. Thus, although at national level, the seaweed industry may currently have a limited contribution to the national economy, it can be a driver of economic prosperity in more rural and deprived communities in the future, as modelled under the high growth scenario in 2040 for Case Study A^[37]. This of course depends on the communities capacity to actually realise this opportunity.

8.5 Social impacts on individuals, communities and society: a national perspective

8.5.1 The social impacts consider impacts at three cluster levels: individuals, community and wider political and environmental impacts. It is important to note that this is a high level exploration of social impacts which may arise from the projected future scenarios. As the sector expands and develops, stakeholder and community opinion will be captured through consenting processes (e.g. marine licence applications for seaweed farms) and research into social licence and acceptance of seaweed cultivation (e.g. Billing et al, 2020). There are different aspects that are considered under each cluster, as depicted in Table 22; but not all of them will be relevant. For instance, it is unlikely that the development of a seaweed industry will have a significant impact on education and impacts on recreation and amenity will be highly dependent on location and conditions attached to consents. Equally, impacts on landscape will be highly variable and likely to be part of the key considerations in the consenting processes.

Table 22 Social impact assessment

Cluster	Aspects included in the assessment	Assessment at the national and community scale
		BAU scenario (2040)	Higher Growth scenario (2040)
Individual	Family, family life, inter-generational issues	Increase in employment with potential positive impacts on family life arising from increased financial stability, higher disposable income, reduction in child material deprivation Potential for negative impacts on family life if jobs require relocation which could have negative impacts on child wellbeing, or if increased working hours results in less family time Impacts significantly more noticeable at the local community level than on the national level
		Increase of 160 FTE per year by 2040 nationally and 40 FTE per year by 2040 per community	Increase of 490 FTE per year by 2040 nationally and 122 FTE per year by 2040 per community
		National: + Island: + + Mainland: + +	National: + Island: + + + Mainland: + +
	Jobs, career, employment	Potential increase in the number of households with at least one member in paid employment, potential for on-the-job training improving skills and furthering career prospects. Potential for increased demand within existing supply chains, benefitting small business with increased financial security. Potential negative impacts to supply chain if there is a lack of spare capacity, but given the moderate nature of impacts, this effect is expected to be negligible
		Reduction in unemployment of up to 12% (island), 3% (mainland) and 0.14% nationally	Reduction in unemployment of up to 36% (island), 8% (mainland) and 0.43% nationally
		National: + Island: + + Mainland: + +	National: + Island: + + + Mainland: + +
	Money, cost of living	Increased employment potentially increasing household net income, reducing the proportion spent on essentials (e.g. housing, food). Potential positive impacts on the proportion of individuals earning a living wage, particularly if skilled jobs are taken up by skilled individuals who were previously employed in unskilled jobs Potential negative impacts if jobs are filled from relocation, increasing prices and housing costs as demand rises, although likely to be highly negligible
		Increase in GVA of £13.4 million per year by 2040 nationally, and increase of 0.5% (island) and 0.2% (mainland) GVA by 2040	Increase in GVA of £45.1 million per year by 2040 nationally, and increase of 1.6% (island) and 0.7% (mainland) GVA by 2040
		National: + Island: + Mainland: +	National: + Island: + + Mainland: +
Community	Local jobs, local industry, community, sustainability	Potential increase in the number of innovative seaweed businesses, developing sustainable high value products Impacts on industry at the regional level could provide further support for businesses within a region, boosting the long-term sustainability of supply chain business. In particular, if supply chain efforts are coordinated with other similar industries. There could be some displacement from other industries, but due to the scale of growth considered here, it is expected that these will be negligible in the medium to long-term, where low skilled jobs could be filled in by people in current unemployment.
		Some opportunities for diversification but limited to production since all seaweed is provided through wild harvesting	Potential for diversification of existing businesses, e.g. through increased demand for boats, ropes from growth of seaweed cultivation
		National: + Island: + Mainland: +	National: + Island: + + Mainland: + +
	Transport connections, technology connections	Unlikely to significantly impact on transport connections at the national level Minor potential for some improvements in existing transport connections if regional concentration of industry is particularly high, or negative impacts if regional concentration is particularly high without equivalent improvements to existing transport channels
		National: 0 Island: + Mainland: +	National: 0 Island: + Mainland: +
	Education	Potential increases to on-the-job training, investment into research and development. Impact negligible at the national level, but could have significant impacts at a regional level if industry concentration is sufficiently high If jobs require relocation, potential for negative impacts from increased pressure on schools, potentially increasing class sizes. Likely to be negligible at a national level, but impacts may be more pronounced at a local level. There may be positive impacts where additional families could help support local schools that are below capacity
		Likely to be limited in-migration to take up jobs, could be more significant for island community than mainland.	In-migration to take up skilled jobs more likely in island community with impacts dependent on age of migrants and whether they bring their family and settle for the longer-term
		National: - / + Island: - / + Mainland: - / +	National: - / + Island: - / + Mainland: - / +
	Shops, housing	Disposable income after housing costs may benefit local business and shops, unlikely to increase the number of shops but could provide existing support to established businesses Potential negative effect on housing availability, but unlikely to be noticeable at the national level. Potentially noticeable at the regional level if relocation for jobs is particularly high
		Likely to be limited in-migration to take up jobs, so impacts on housing demand and prices is expected to be limited	In-migration to take up skilled jobs more likely in island community with need for housing that could increase demand
		National: - Island: - Mainland: -	National: - Island: - - Mainland: -
	Socialising, recreation, parks, leisure	Potential increase in free time for socialising and recreation if jobs are retained locally, potential negative impacts on free time for socialising if jobs require extended commuting. There could be some relocation to rural areas, depending on location of development. There could be some negative impacts on landscape and amenity, hindering recreation. The net effects will depend on scale of development, management practices and location so they are difficult to establish with accuracy.
		National: - / + Island: - / + Mainland: - / +	National: - / + Island: - / + Mainland: - / +
	Friends, being involved, supporting others	Increased employment leading to a decrease in relative poverty may improve the proportion of individuals who feel supported Increased employment potentially increasing individuals social network, providing more support and opportunity to engage in social activities Potentially positive impacts from increased employment reducing social exclusion
		National: + Island: + Mainland: +	National: + Island: + + Mainland: +
	Local identity, cultural heritage, Gaelic	Potentially positive impacts from increased employment if increased income leads to more engagement with cultural activities Impacts on local identify depend on the extent to which jobs are retained by local people or relocation is required. May impact on proportion of Gaelic speakers if relocation takes place, which could have positive or negative impacts on local identify Local industry conducive to strong community identity at the local level, sense of pride to region
		National: + Island: + Mainland: +	National: + Island: - / + Mainland: +
	Healthcare	Potential positive impacts on both physical and mental health. Employment highly correlated with improvements to healthy life expectancy, and reduced mental health conditions such as depression and anxiety If relocation is required, potential for increased demand on healthcare providers, although likely to be negligible.
		National: + Island: + Mainland: +	National: + Island: + + Mainland: +
	Connection to nature, landscape	Potential positive impacts on connection with sea through career, positive impacts if relocation from urban to rural with more access to nature If jobs are retained locally positive impacts on commute times, improving opportunity to spend time in local natural environments Potential negative impacts on perception of local landscape if industry is highly developed
		National: + Island: + Mainland: +	National: + Island: - / + + Mainland: - / +
	Local political and decision-making systems	Potential positive impacts on political engagement, with evidence suggesting unemployment correlates with political disengagement, particularly where unemployment drives social exclusion
		National: + Island: + Mainland: +	National: + Island: + + Mainland: +
Wider political and environmental context	National and EU level political and decision-making systems	Potential positive impacts on Scotland's reputation within the seaweed industry which could potentially enable future investment or government funding schemes Potential positive impacts on political engagement and satisfaction with rising employment
		National: + Island: + Mainland: +	National: + Island: + + Mainland: +

HG = Higher Growth

8.6 Impact on other marine industries

Under the BAU scenario

8.6.1 Wild harvesting of seaweed has been undertaken in Scotland for hundreds of years and occurs in the intertidal or shallow subtidal area. Under the BAU scenario wild harvesting is projected to increase from approximately 8,000 tonnes p.a. to 25,000 tonnes p.a. by 2040.

8.6.2 The Wild Seaweed Harvesting Strategic Environmental Assessment (SEA) (Marine Scotland, 2016) identified a range of potential environmental effects associated with wild harvesting of kelps, including loss of habitat, loss of nursery grounds for juvenile fish and invertebrates, physical effects at the coast and/or loss or damage to cultural heritage assets. Assessment of environmental impacts (of wild harvesting or cultivation of seaweed) was outwith the scope of this current study, however, some of the potential environmental effects described in the SEA could have potential consequences (directly or indirectly) for other marine users, including commercial fishing and recreation and tourism, as well as coastal communities. In this study, consultation indicated that many industry stakeholders felt that sector growth (in the form of expansion of production of existing seaweed-based products and development of new products) could be met by raw material provided through wild harvesting (Section 5). The current scale of wild harvesting is a very small proportion of the available resource^[38] and no major environmental issues have been identified in relation to the current levels of harvesting currently undertaken. However, no 'threshold level' of kelp harvesting was identified in Burrows et al (2018) or the SEA that could be deemed to represent an 'insignificant' impact. Hence, the potential environmental effects of increasing wild seaweed harvesting to 25,000 tonnes (noting the vast majority of which under the BAU scenario would still be the wrack species A. nodosum), would need to be assessed under the current consenting process (see Appendix A). Direct effects (e.g. competition for sea space) or indirect effects (arising from any environmental impacts) would also need to be assessed.

Under the higher growth scenario

8.6.3 Under the higher growth scenario, wild harvesting is projected to increase to 30,000 tonnes p.a. slightly greater than under BAU. As per the BAU scenario, the potential environmental impact of increasing wild harvesting levels would need to be assessed under the current consenting process. Direct effects (e.g. competition for sea space) or indirect effects (arising from any environmental impacts) would also need to be assessed.

8.6.4 The Higher Growth scenario assumes production of 24,000 tonnes of cultivated seaweed. This level of cultivation would require significant infrastructure (i.e. farm developments at sea) and hence may present potentially significant interactions with some other marine industries, in particular the commercial fisheries sector, depending on the extent and location of the developments. Furthermore, as in general competition for 'sea area' is a constraint on both emerging and established marine sectors looking to expand the seaweed cultivation sector may compete with finfish and shellfish aquaculture business for lease areas.

8.6.5 The spatial extent of seaweed farms that might be required to provide an annual harvest of 24,000 tonnes will depend on the density of seaweed within the farms (i.e. whether intensive or extensive farming is undertaken). Based on information contained within a scoping report for an offshore seaweed farm off the Norfolk coast (Sustainable Seaweed Limited, 2019), this would require production over an area of several km² for brown seaweeds such as S. latissima. However, given the emergent nature of the cultivation sector in the UK, it is not possible to accurately estimate the area required to produce 24,000 tonnes per annum. It can be noted that in July 2021 the total area licensed for seaweed farming in Scotland, together with the area contained within marine licence applications for seaweed farms, is over 2km^{2 [39]}, with the largest licensed area to date being 0.5 km².

8.6.6 It is assumed that any seaweed farm would exclude the use of mobile fishing gear (resulting in the permanent loss of fishing grounds) although, there may be potential for the continued use of static gear (pots/creel) for example if the seaweed farm design enables access for fishing vessels to deploy and retrieve this gear. If the seaweed cultivation sector develops, liaison with static gear fishermen in areas of interest for farms regarding design and access will likely be needed to mitigate any negative interactions and impacts.

8.6.7 A further impact of potential seaweed farming related infrastructure deployment at sea may relate to perceived or real visual impacts of seaweed farms on the amenity value of an area, an issue which is also dealt with via the marine licensing system. To the best of our knowledge there is no evidence that aquaculture installations impact tourism (e.g. Nimmo et al 2011), however, depending on the level of social licence for seaweed farms within communities this may result in difficulty in finding socially acceptable locations.

8.6.8 Based on the above, it is likely that the emergence of a cultivated seaweed sector would have some interaction with commercial fishing activity and some level of competition with finfish and shellfish aquaculture for lease areas. The scale of any impacts on other marine users will depend on the nature, location and extent of cultivated seaweed installations which would be addressed through the marine licensing process for individual seaweed farm developments. Farms covering more than 1000 m² of the seabed are commonly required to undertake pre-application consultation under the Marine Licensing (Pre-application Consultation) (Scotland) Regulations 2013 (Marine Scotland Licensing Operations Team, pers. comm.).