Understanding Business- September 2025

The tenth wave of the Understanding Business survey offers a timely snapshot of how Scottish businesses are navigating a landscape marked by cautious optimism and persistent challenges.

This edition reveals a continued improvement in economic sentiment. Fewer businesses now believe conditions are worse than a year ago. Confidence in profitability and turnover has improved, with half of all businesses expecting turnover to grow over the next year, a record level since the survey began.

Recruitment challenges remain, but the nature of these is shifting. Skills shortages continue to top the list, while challenges with salary expectations and a lack of applicants have increased in the last quarter, suggesting evolving pressures in the labour market.

Cyber attacks have emerged as the most pressing crisis concern, with an overwhelming majority of businesses both worried about and prepared for potential attacks. Other risks, such as internal malpractice and lawsuits, show a disconnect between concern and preparedness, where the latter is considerably higher than the degree of concern among business leaders.

Businesses continue to express a desire for targeted interventions, with reduced taxation, increased support for business owners and reduced business rates seen as the most helpful measures for growth.

As Scotland approaches a pivotal election year, business perceptions of political parties remain relatively stable, though recognition of key spokespeople is low. This wave underscores the importance of clear, credible leadership in shaping Scotland’s economic future.

Overall, the September 2025 wave reflects a business community that is cautiously optimistic and keenly aware of the challenges that lie ahead.

You can read the report here:Understanding Business, Wave 10 – September 2025