Figures show Isles offer fewer entrepreneurs than Orkney and Western Isles

Shetland is failing to offer enough entrepreneurs, with self-employment levels dropping over a seven year period – despite a nationwide increase.
Figures from the Federation of Small Businesses show the number of people working for themselves in the isles suffered a two per cent drop between 2008 and 2015.

Orkney’s figure increased by 2.6 per cent in that same time-frame, making it Scotland’s fourth most entrepreneurial local authority area.

The Western Isles came in sixth, and the Highlands stood just outside the top10, in eleventh position. But Shetland came in a disappointing 14th.
Overall, the FSB says Scotland’s performance leaves much to be desired, falling behind the rest of the UK, and other European nations.

Development Manager of the FSB Highlands & Islands, David Richardson, said: “Scotland’s performance still lags behind the rest of the UK and many competitor European countries. We’re simply not cutting the mustard, and this matters.

“Sadly, this problem applies to Shetland too, where self-employment dropped by 1.7 per cent between 2008 and 2015, against a national increase of 0.9 per cent.

“In Orkney it increased by 2.6 per cent in the same period. The result is that in 2015, Orkney was the fourth most entrepreneurial local authority area in Scotland, the Western Isles 6th, the Highlands 11th and Shetland 14th.

“While we know what is going on at council level, no-one thus far has sought to explain why some communities are more entrepreneurial than others at a local level, or to determine what can be done to raise the bar. FSB has now stepped into the breech, using national census data to produce our Entrepreneurial Towns Report, launched earlier this month.”

Mr Richardson said analysis showed the country’s most entrepreneurial settlements, Ullapool and Newtonmore, typified a pattern found throughout the country’s rural areas.

He said the most entrepreneurial towns and villages tended to be smaller, wealthier, self-contained rural market towns and villages, with few significant private or public sector employers nearby.

He said many of the most successful were “tourist honey-pots,” with visitors having their needs met by small, local, independent businesses, and those visitors sometimes relocating there to set up their own enterprises.

“However, Lerwick and Scalloway, while possessing many of the characteristics described above, don’t have them all and therefore appear quite far down the league table for the Highlands and Islands,” Mr Richardson added.

Lerwick and Scalloway appear quite far down the league table – DAVID RICHARDSON

“Scalloway is 30th out of 38 and Lerwick 34th.

Clearly, there is very good reason for this: fishing and energy are both big employers and the public sector has a strong presence, and to these can be added the spread of supermarkets and online shopping.

“Some parts of Scotland also suffer from poor educational attainment and IT skills levels, higher levels of poverty, perhaps as a result of a large employer closing, and a lack of tourist footfall, and it is inevitable that people in these communities will find it harder to start businesses than elsewhere.”

He called for a fairer rates system and for a “small business bonus” to be retained.

The FSB also wants to see:

• More simplification and streamlining of public sector-managed business support.
• For the digital roll-out to be speeded up in rural areas.
• For more investment in local infrastructure to give local economies a leg-up.
• And for the self-employed to be given the same welfare rights as those in employment.

Mr Richardson said the Scottish government should also make a long-term investment in enterprise education to foster a more entrepreneurial culture in schools, colleges and universities.

“Only a minority of pupils leave education knowing the basics of how to run a business, and this has to change.”

He also called on councils to offer their empty premises rent-free to local entrepreneurs seeking space in which to operate.

“It is very important that councils continue to invest in economic development and, while understanding the financial pressure that they are all under, the budget should be preserved.”

He also called for more people to buy goods and services locally.

• The use of Shetland dialect by businesses branding their products or services will be one of the key themes during Shetland Business Week, which is coming to the isles for the first time from 25th February.

The event brings together businesses, social enterprises and entrepreneurs, and is hosted by Highlands and Islands Enterprise (HIE), Business Gateway Shetland and the Federation of Small Businesses in conjunction with the SIC.

Organisers say those attending can take advantage of free workshops, seminars, networking events and discussions.

Other themes covered include a Scotland economic update, developing young people, social media, collaborative working, digital marketing and specific industry panel discussions.

HIE’s development manager, David Priest, said: “Shetland Business Week is looking great. We hope to have an informative, engaging and interesting week for businesses and for anyone interested in starting a business, or just looking to improve their business knowledge and get up to date.”