Scotch whisky - cornerstone of Scottish economy

A new study has revealed that Scotch whisky is worth £4 billion a year in added value to the Scottish economy - with the industry spending in excess of £1.1 billion annually on supplies produced in Scotland.

The study - The Economic Impact of Scotch Whisky Production in Scotland - by Verso Economics, also revealed the industry’s annual turnover in Scotland is now £6.4 billion and that after oil and gas the sector remains the country’s leading manufactured export, with shipments of £3.1 billion a year.

The spending with Scottish suppliers, which includes £200 million on cereals, helps support 35,000 Scottish jobs, with the industry itself directly employing 10,300 people across the country.

The study, commissioned by The Scotch Whisky Association, also revealed:

  • Spending with Scottish suppliers has increased by 61% since 2000
  • Export value has grown by 42% since 2000 (from £2.2 billion)
  • Capital spending of £355 million a year, of which nearly a third is invested in Scotland
  • Scotch whisky’s economic impact is as significant as tourism - with employees adding twelve times more value per head
  • Industry productivity at £262,000 per employee is six times the Scottish average
  • One fifth of Scotch whisky jobs are in the more fragile rural communities across the Highlands & Islands
  • Scotch whisky supports double the number of Scottish jobs than those in aerospace and defence, as well as a similar number to those employed in Scottish universities
  • The majority of employment is found in Strathclyde (52%), Central Scotland & Fife (17%) Grampian (14%), and Lothian (11%)

Welcoming the study's conclusions, Gavin Hewitt, SWA Chief Executive, said: "Scotch whisky's importance to Scotland is clear. The study confirms Scotch whisky is a cornerstone of the Scottish economy, supporting 35,000 jobs and generating around £4 billion in added value. That economic impact benefits every corner of Scotland, with distillers spending over £1 billion across the supply chain.

"The new UK Government wants to support manufacturing and exporters, and build a fairer tax system. It could combine all three objectives by reforming an unfair duty regime which undermines the competitiveness of the Scotch whisky industry. The alcohol duty structure is no longer fit for purpose, discriminating against Scotch whisky at home and sending out the wrong message overseas.

“We are pleased the new Coalition Government has announced it will review alcohol taxation. The aim must be to put in place a fairer and more socially responsible regime where all alcohol is taxed according to content. With the right support, the Scotch Whisky industry can deliver even more to communities across Scotland."