Aberdeen Faces Job Losses as North Sea Oil Declines, Green Transition Falters
Aberdeen, the city historically synonymous with North Sea oil wealth, is now confronting a stark economic reality. As oil and gas production declines, a promised 'just transition' to renewable energy appears to be failing many, leading to widespread job displacement and underemployment for highly skilled professionals.
Iona Macdonald, a chemistry graduate who spent 25 years in the oil and gas sector, exemplifies this struggle. After being made redundant two years ago, she now earns minimum wage in a Glasgow pub, unable to secure a role in renewables. Her experience is not isolated, with many former six-figure earners reportedly taking on low-wage work, highlighting the difficulty in transferring specialised technical skills.
The North Sea's Decline and Renewables' Slow Rise
North Sea production, which peaked at 4.5 million barrels of oil equivalent per day (BOE) in 1999, has plummeted to just over one million BOE in 2024. In contrast, UK homegrown renewables now generate over 50% of electricity, up from 7% in 2010, yet this growth has not translated into sufficient job creation.
Paul de Leeuw, director of the Energy Transition Institute at Robert Gordon University, notes that the oil and gas workforce has shrunk by 70,000 to 115,000 over the past decade. In the same period, only 39,000 new renewables jobs emerged. He attributes this imbalance partly to fiscal instability, with "five tax changes in four years" deterring investment in the UK North Sea, pushing capital towards more stable environments like Norway.
The net loss of employment has rippled through north-east Scotland, affecting support services from hospitality to legal professions, according to Russell Borthwick of the Aberdeen and Grampian Chamber of Commerce.
Political Rhetoric Versus Economic Reality
While UK Energy Secretary Ed Miliband speaks of a "moral and practical duty" for a just transition, critics, including affected workers like Iona Macdonald, argue that the reality on the ground contradicts official statements. Dr Ewan Gibbs, an energy policy expert at Glasgow University, suggests that the electrification of the British and Scottish economies has not occurred at the necessary pace to absorb the displaced workforce.
The debate is further complicated by external pressures. US President Donald Trump recently urged the UK to "DRILL, BABY, DRILL!!!" and abandon windmills, advocating for continued fossil fuel extraction in the North Sea. Reform UK, led by Nigel Farage, echoes this sentiment, campaigning to maximise domestic fossil fuel production and reverse 'net zero' policies ahead of the 7 May Scottish parliament election.
Mainstream Scottish parties, including the Scottish National Party (SNP) and Scottish Labour, support a 2045 net zero target for Scotland, though their approaches to oil and gas vary. First Minister John Swinney, leading the SNP, has softened his party's stance on new drilling, factoring in energy security while maintaining climate compatibility assessments. Other parties propose combinations of green energy, nuclear power, and grid investment, with some even considering approval for fields like Rosebank and Jackdaw if they prove more environmentally sound than importing fossil fuels.
Lessons from Grangemouth and the Shadow of Coal
The closure of Scotland's only oil refinery at Grangemouth last year, resulting in 400 direct job losses and impacting an estimated 2,800 supply chain workers, serves as a stark warning. Dr Gibbs states this event significantly "discredited the notion of a just transition," eroding faith among workers and communities in using existing skills for a greener future. The historical trauma of coal mine closures under Thatcher looms large, with all parties professing a desire to avoid a similar "unjust transition."
Despite the current challenges, Iona Macdonald remains committed to moving away from fossil fuels, advocating for an accelerated shift to clean alternatives. However, she warns that the current mismanagement is leading to a "drain of all those skills and experience, which is a negative thing for the economy overall." The transition, she argues, is being "fumbled," demonstrating that political slogans alone cannot deliver the complex economic and social changes required.
