They were the main findings of the South of Scotland Business Panel Survey.
And 97 per cent of the firms who took part reported increased costs during the last 12 months, and expect the issue to continue this year.
However, four in five (77 per cent) of businesses in the region were optimistic for their prospects for the next 12 months.
The region-wide survey of 602 businesses and social enterprises – which took place in October and November 2021 prior to the emergence of the Omicron variant – also found positive signs of recovery from covid. It found two thirds of businesses were now operating at either the same level or over and above their pre-pandemic position.
The survey interviewed a representative sample of South of Scotland businesses and social enterprises from various sectors who provided their thoughts on a series of important topics such as performance, labour, supply chain, operating levels, Fair Work and Net Zero.
Other key findings include:
Top priorities – the most common priorities for businesses over the next 12 months were keeping pace with new technology and innovating or evolving what they do
Financial concerns and access to finance – around a third were concerned about at least one of the following aspects of their finance
Increased costs – businesses were more likely to absorb costs rather than pass them on to customers through price increases.
Labour – 49 per cent said they had experienced some form of labour shortages: arising from recruitment or retention challenges, and staff absence.
Supply chain – 74 per cent were experiencing some form of supply chain issue.
Net Zero – 96 per cent said they were taking action to cut their greenhouse gas emissions, with the main actions being recycling and minimising waste, using more locally sourced supplies and improving the energy efficiency of premises
Fair Work – 75 per cent were taking action to support Fair Work for their staff, including paying the real Living Wage, and flexible working
The survey is commissioned by South of Scotland Enterprise (SOSE) and chief executive Jane Morrison-Ross said: “The South of Scotland Business Panel Survey is a really important exercise which allows us to gauge the current mood of the business community in the region.
“The survey highlights the ongoing difficulties being faced, with increased costs, labour shortages and supply chain issues at the forefront of business concerns.
“Despite these challenges, it is encouraging to see optimism for 2022 among the South of Scotland business community for the next 12 months.”
The full report is available at www.southofscotlandenterprise.com/business-surveys.
