The latest South of Scotland Business Survey has highlighted the resilience of the region’s business community.
Taking place in late-2025, the survey of 600 businesses across the South revealed that over 70% reported either good or steady performance in the last six months, despite the challenging economic conditions.
Almost half of all companies (46%) said they were striving for growth, an increase on the previous survey which took place last summer.
Over the past six months, 71% of businesses stated that their sales or turnover had either increased (35%) or remained the same (36%).
In addition, 61% of businesses reported that profit margins had either increased or remained the same, while just over a third (35%) said their profit margins had decreased.
In terms of workforce, there are positive signs businesses were providing opportunities to graduates and apprentices to begin their careers. Among businesses that had sought to recruit, more than half (57%) had recruited graduates, while 19% had recruited apprentices.
With a number of external and national challenges over the last year, the survey also highlighted issues related to confidence and recruiting staff.
The South of Scotland Business Panel survey sees Ipsos – on behalf of South of Scotland Enterprise (SOSE) – interview companies and social enterprises from across the region each year.
It provides a temperature check of business confidence and helps identify challenges and opportunities.
The full survey is available to view at southofscotlandenterprise.com/business-surveys.
Jane Morrison-Ross, Chief Executive of SOSE, said:
“Businesses and social enterprises across the South of Scotland remain ambitious, resilient and firmly focused on growth, even in the face of a challenging economic climate.
“The latest South of Scotland Business Survey reinforces this strength, highlighting the continued commitment of business leaders to creating opportunities for graduates and apprentices — a vital investment in the future of our region.
“We recognise the external pressures businesses are navigating, and we remain steadfast in our commitment to work closely with partners to unlock value and provide meaningful financial and non-financial support.
“In 2024/25 alone, we engaged with a record number of businesses, social enterprises and community groups, approving £10.3million in funding for 558 client-facing projects across the South of Scotland.
“Momentum continues to build, with significant and exciting investments flowing into the region, including Breathe Life Sciences, CX Power at Chapelcross, and Center Parcs.”
Adam O’Sullivan, SOSE’s Lead Analyst for Economic Insights, added:
“The South of Scotland Business Panel provides an important temperature check on what current business sentiments are across the region, as well as their priorities for the future.
“We must thank all 600 businesses who took the time to be part of the latest survey.”
Workforce and recruitment
- Three quarters (74%) of employers had enough staff to fill all the roles they needed while 24% did not. Similarly, 85% of employers had the right levels of skills in the business while 15% did not.
- Of the two thirds (66%) of businesses that said workforce was a significant challenge, (25%) cited recruiting staff as a top concern. Other concerns included cost of labour (49%) and the ability to pay competitive wages (31%).
- 36% of business had sought to recruit in the past year, while 62% had not. Among businesses that had sought to recruit more than half (57%) were graduates, while 19% had recruited apprentices.
- Among businesses who have sought to recruit, skilled trades and craftspeople (31%) and general labourers (28%) were cited as the most difficult roles to fill.
- Among businesses who reported not having the right skills in the business (25%), the most common impact was an increased workload for existing staff (81%).
Optimism and performance
- Of the businesses who reported to be performing well (31%), the most commonly cited reasons were increased demand (66%), followed by efficiency improvements (37%), and having made cost savings (26%).
- While businesses who had said they are struggling (28%), the majority cited costs (80%), reduced demand (59%) and compliance with legislation and regulation (37%) as the most common reasons.
- Over the past six months, 71% of businesses stated that their sales or turnover had either increased (35%) or remained the same (36%), with 28% reporting a decline.
- Confidence in the economic outlook of Scotland remains muted, with 35% of businesses reporting confidence, while 63% were not confident.
- Half (51%) of businesses said their confidence had decreased over the past six months, 45% said it had stayed the same, with 4% reporting an increase.
- 61% of businesses reported that profit margins had either increased or remained the same, while just over a third (35%) said their profit margins had decreased.
