A new report from the Scottish Liberal Democrats has revealed a concerning drop in the number of small and medium-sized enterprises (SMEs) across Scotland since 2020. The data shows that the number of SMEs in Scotland has fallen from 177,020 to 171,660 – a decline of 5,360.
Jamie Greene MSP, the Scottish Liberal Democrats’ economy spokesman, has called on the Scottish National Party (SNP) government to urgently boost support for small businesses. He has asked the Scottish Government to provide the number of SMEs in every Scottish parliamentary constituency since 2015, in order to better understand the extent of the issue.
The data shows that over the past decade, 24 parliamentary constituencies have seen a fall in the number of SMEs, with notable declines in more rural parts of the country. This includes a 13.8% fall in SMEs in constituencies across Aberdeen and Aberdeenshire since 2015, and an 8% fall in Caithness, Sutherland and Ross.
Greene expressed concern over the figures, stating that many skilled and entrepreneurial people feel there are too many barriers to starting their own businesses, from the SNP’s “economic incompetence” to the “crushing burden of red tape.”
While the Scottish Liberal Democrats have secured tens of millions in support for businesses in this year’s draft Scottish budget, including a new £2.5 million package backing young entrepreneurs and £36 million for business rates relief, Greene believes the Scottish Government can do more.
In response, Deputy First Minister Kate Forbes said that the Scottish Government has been “working systematically” to develop the support required to help entrepreneurs and start-up companies succeed. She pointed to a 17.9% increase in Scottish start-up businesses in the first half of 2025 and a 24% growth in investment deals in Scotland during the same period.
Forbes stated that the Scottish Budget 2026-27 will continue to support businesses, investment, and a skilled workforce to accelerate economic growth, including record funding for entrepreneurs and start-ups.
The decline in Scottish SMEs is a concerning trend that requires urgent attention from the Scottish Government. With the right support and policies, the country’s entrepreneurs and small businesses can play a vital role in driving long-term prosperity.