More businesses opening than closing, stats show

More businesses opened than closed in Scotland, an analysis of data from the Office of National Statistics (ONS) shows.

It is the first time in five years that more businesses were added to the ONS register than removed.

The UK government's official statistics body has data on more than 2.7 million businesses which pay VAT or PAYE, covering all but the smallest firms.

An analysis of the latest figures shows there were 18,025 business "births" and 17,655 business "deaths" in Scotland last year.

However, separate ONS research found Scottish businesses were still worried about the impact of taxation, competition and falling demand for goods and services.

Kenny Richmond, head of insights and economics for Scottish Enterprise, told the BBC: "It's a challenging global economic environment for businesses at the moment, but despite those challenges Scottish businesses are showing resilience and innovative spirit, with many actively looking to grow and scale."

The ONS data shows the same trend across the UK, however there had been a longer period of decline in Scotland.

The last time there were more businesses opening than closing in Scotland was 2019 as opposed to 2021 for the UK as a whole.

Last year, across the UK a total of 306,995 new businesses opened and 297,760 closed.

The ONS data also breaks down the changes by industry across the UK.

Most industries saw a decrease in business closures, with the biggest difference being 29.8% fewer transportation and storage firms closing.

Only three sectors had more closures than 2023.

They were the finance and insurance sector, which saw the biggest decline at 4.8%, agriculture, forestry and fishing, which was down 4.2%, and real estate, which saw a 3.2% decline.

The biggest increase in new businesses was the business administration and support services sector, which had a 43.8% rise compared with the year before.

Meanwhile, the health and social care sector saw the biggest decrease in new businesses, down 11.8% in the same period.

Despite the positive trends, businesses are bracing themselves for challenges ahead.

This month, ONS surveys found that 8.8% of Scottish businesses owners said taxation was their main concern for their business, compared with 2.4% this time a year ago.

This follows UK Chancellor Rachel Reeves' announcement of an increase in National Insurance for businesses.

From the start of the next financial year, beginning in April, employers will pay 15% National Insurance on workers' wages, up from the 13.8% now.

Research by the Federation of Small Businesses (FSB) found that confidence among small businesses in Scotland was "at its lowest level since the height of the pandemic during the final quarter of 2024".

"So many of the pressing issues facing small business owners right now come down to cost and cashflow," said Andrew McRae, FSB Scotland policy chair.

The FSB also found that eight out of 10 small firms in Scotland experienced rising costs, with most citing the cost of utilities (62%) and labour (53%) as the biggest cause of the increase.