Capital 'will bounce back' from public sector's cuts

The survey by consultants Experian measured the resilience of local economies across the country, taking into account the mix of companies in each area and how far the private sector was likely to take up the slack.

Aberdeen and Aberdeenshire were the only places that came out ahead of Edinburgh. The analysts said the offshore oil sector and agriculture, both strong in the North East, had proved buoyant in the face of the economic downturn.

But East Lothian, Midlothian and West Lothian were all in the bottom half of the table.

Following Chancellor George Osborne's spending review on Wednesday, it has been estimated up to 60,000 public sector jobs in Scotland are likely to be lost, along with a further 35,000 in private firms dependent on public spending.

Councillor Tom Buchanan, the city's economic development leader, said the Experian survey was good news.

He said: "This is based on the potential spending cuts and the effect that will have on areas reliant on public-sector employment.

"It's good to see the survey reckons Edinburgh - even though we've got the parliament and government offices - is viewed as the third best place in Scotland to get through this difficult period."

He said public-sector jobs in the Capital included many "high-end" posts compared to some places where there was a concentration of call centre or back-office staff.

Cllr Buchanan added: "A number of commentators have recognised Edinburgh has handled the recession better than similar cities down south.

"Business leaders are largely positive about what the council is doing, but recognise there are challenges ahead."

In the survey, Edinburgh was ranked 62 out of 356 areas across the UK. East Lothian was 18th out of Scotland's 32 local authorities and 236th across the UK. Midlothian was 19th in Scotland and 260th across the UK while West Lothian was 22nd in Scotland and 273rd in the UK.

Claire Reid, Experian's strategic development director, said: "Although Edinburgh has a large number of public sector jobs, in terms of the proportion of the total jobs in the local economy it is below average.

"High-tech manufacturing, professional and business services are a higher proportion of the economy."

She said the dominance of the financial services sector in the Capital had both positive and negative effects.

She said: "There are clearly challenges it is an important sector for Edinburgh and in time it will return to growth."

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