A pen in hand filling out a paper questionnaire

Mixed outlook from latest South of Scotland Business Panel Survey results

The ongoing challenges presented by the cost crisis are reflected in the latest South of Scotland Business Panel Survey.

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Main findings

The survey, carried out in June and July 2022, found 95% of the 600 businesses and social enterprises interviewed say rising costs was impacting their operations.

Rising costs, alongside increased inflation and the Ukraine-Russia conflict, also had an impact on business confidence, with 40% of businesses saying they were optimistic for the next 12 months, down from 52% during the previous survey in February and March 2022.

Despite the challenges, 91% of those interviewed were confident in their own viability over the next six months.

Overall, there was a mixed outlook for the 12 months ahead, with most businesses and social enterprises (83%) taking at least one action in response to changes in their working environment.

What is the South of Scotland Business Panel Survey?

The South of Scotland survey is part of a wider rural Scotland study in partnership with the Scottish Government and Highlands and Islands Enterprise which currently takes place three times every 12 months. 

Other key findings


  • Two in five businesses and social enterprises were striving for growth, in line with previous surveys. A similar proportion wanted to retain their current level of performance, and around one in ten wanted to downsize.


  • Among employers, 56% felt issues attracting new talent was a risk to the business. This was followed by skills shortages (54%), staff working at capacity (53%), ability to pay competitive wages (50%) and lack of permanent staff (45%).

Responding to change

  • The top three actions planned by businesses and social enterprises in response to changes in their working environment, included using greener supply chains (47%), more locally sourced supplies (45%) and upskilling or reskilling staff (45%).
  • Among those that were upskilling or reskilling their workforce, the most sought-after skills were use of new technologies (78%), specialist or technical skills (68%) or digital skills (67%).

Findings by sector

  • Tourism – businesses in tourism were more likely than other sectors to still be operating below pre-COVID-19 pandemic levels. However, they had higher than average confidence in the economy and were more likely to be striving for growth.
  • Food and drink - businesses in this sector had seen relatively stable performance over the last six months. However, they were less confident than average in the economy and more likely to have been impacted by rising costs, the Russia-Ukraine conflict and Brexit.

Findings by rurality

  • Remote rural businesses - they were more likely than average to feel that skills shortages and lack of staff accommodation were risks to their business. In response to changes in the working environment, remote rural businesses were more likely to be collaborating and sharing resources.
  • Accessible rural businesses – more likely to want to downsize. In the 12 months ahead, they were more likely to be minimising change.
  • Businesses in small towns and other urban areas - more likely to say that they were impacted by COVID-19. They were more confident than average in the economy and more likely to be striving for growth.

Jane Morrison-Ross, our Chief Executive

“The latest South of Scotland Business Panel Survey highlights the pressures businesses and social enterprises are currently facing.

“It is completely understandable that confidence has been impacted in the face of rising costs.

“However, it is also encouraging to still see optimism and resilience strongly evident amongst the businesses and social enterprises who took part in the survey.

“In addition, it is also fantastic that there remains an environmental focus, to change to greener supply chains and more locally sourced supplies.

“The results emphasise what our priorities should be now to help businesses and social enterprises through this difficult time, and for the next ten years if we are to realise our shared ambition for a thriving South of Scotland.

“I would encourage any business or social enterprise currently facing rising costs to visit findbusinesssupport.gov.scot/cost-of-doing-business for the latest advice, information and support, or to come speak to us.”

Zoe Meldrum, our Economic Research Insights - Lead Analyst

“We must thank the 600 businesses who took part in the latest South of Scotland Business Panel Survey.

“The business panel survey is really important in terms of allowing SOSE and partners, including the Scottish Government, to get experiences and views of businesses and social enterprises in the South, and how best to support them.

"We are always looking to increase membership of the Panel, and anyone interested in joining should visit www.southofscotlandenterprise.com/business-surveys."