More Highland businesses struggling in ‘challenging economic headwinds’ according to new survey
Economic uncertainty and rising costs are among the main challenges faced by businesses in the Highlands, with more businesses saying they are struggling than in previous years.
According to a survey by Highlands and Islands Enterprise (HIE) around 28 per cent of businesses in the Highlands and Islands said they have struggled in the second half of 2024 - up from 21 per cent in the previous year.
The development agency has now published a report on the survey - which includes responses from more than a thousand businesses across the region.
According to the survey, which was carried out on the field by Ipsos in November and December 2024, most businesses in the region (72 pre cent) still performed well or steady (31 per cent and 41 per cent) during the six months leading up to the survey, down slightly from 34 per cent and 44 per cent respectively since the same period the previous year.
The biggest challenges facing businesses were economic uncertainty, the cost of doing business, legislation and regulation, and access to skilled labour.
Just under half of employers said they did not have enough people or skills, with temporary or seasonal roles more challenging to fill than permanent positions.
The main barriers to recruitment were availability of required skills (65 per cent), location of the business (49 per cent), and lack of accommodation (42 er cent).
Martin Johnson, HIE’s director strategy and regional economy, said: “We are extremely grateful to all those who have taken part in the survey. Once again, they have provided some extremely useful feedback and detailed insights into the issues and opportunities facing businesses in the region.
“Economic headwinds have become more challenging. Understandably this appears to be affecting business decisions about investment and growth. It’s a real credit to our business community that they have continued to innovate and adapt to continuing economic challenges, even though this has affected confidence and, in some cases, performance.
“The feedback received through these surveys helps us and our partners to inform decisions on how to tailor our support to best meet the region’s needs and maximise our opportunities.”
According to the survey, most businesses (81 per cent) had taken action to improve their working environment - including making processes more efficient, reviewing supply chains, reducing emissions, and using more technology or automation.
Just under half were striving for growth, 36 per cent were content with current performance and 14 per cent wanted to downsize.
Larger businesses (25+ employees) and social enterprises were more likely to strive for growth. While confidence in Scotland’s economic outlook had declined from 50 per cent to 44 per cent since the previous survey, this still appears relatively strong.
The full Business Panel survey report is available on the research and reports section of HIE’s website.
