Scottish Entrepreneurship Soars, But Eastern Region Trails Behind
New research highlights significant regional and gender disparities in entrepreneurial activity across Scotland, with Eastern Scotland showing particular weakness.
By Eilidh Munro
••3 min read
AI
Generic image of a split scene contrasting dynamic urban activity with a less developed landscape, representing regional economic disparities.
Entrepreneurial activity in Scotland has reached a record high of 11.7%, according to new research by the Universities of Edinburgh and Glasgow, yet significant regional disparities persist, particularly in Eastern Scotland.
The Global Entrepreneurship Monitor (GEM) Scotland report for 2025-2026 indicates a nearly two percentage point increase in entrepreneurial activity, the highest since the survey began in 2002. The number of individuals running established businesses has also risen to over one in ten.
Analysis of data from 2,085 adults surveyed in 2025 reveals a rise in entrepreneurship, especially among younger age groups. One in five 18-64 year-olds in Scotland are now classified as entrepreneurs. Early-stage entrepreneurial activity among 18-24 year-olds has remained steady at around 12%, contrasting with UK-wide concerns about economic inactivity among young people.
However, the report highlights persistent gender and regional disparities. While activity levels are similar between young men and women, established business ownership rates are lower for 18-24 year-old women. Overall, 8.7% of working-age women were running or setting up new businesses in 2025, compared to 12.2% of men. Eastern Scotland recorded the lowest rate for women entrepreneurs at 4.6%.
"Concerning" regional disparities were noted, with Eastern Scotland, defined as the region north of the Firth of Forth (including Angus, Dundee City, Clackmannanshire, Fife, Perth and Kinross, and Stirling), showing the lowest rate at 9%, below the national baseline of around 12%. In contrast, East Central Scotland (City of Edinburgh, East Lothian, Midlothian, West Lothian, and Falkirk) reported 13%, and West Central led with 14%.
Entrepreneurship among minority ethnic groups in Scotland continues to outpace that of White Scots, at 21% compared to 11%. Despite 59% of entrepreneurs being content with business support, regional variations exist, with Southern Scotland, Highlands and Islands, and Eastern Scotland below the national average.
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"The re-emergence of a four-percentage-point gender gap in early-stage entrepreneurship, particularly stark in Eastern and North Eastern Scotland, alongside regional differences in perceptions of enterprise support, highlights the need for more targeted, place-based interventions to ensure entrepreneurial opportunity is shared across all of Scotland. Scotland cannot afford a postcode or gender lottery in entrepreneurship if it is serious about unlocking inclusive growth, innovation, and economic renewal."
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"This report identifies the big trends shaping Scotland’s entrepreneurship. It is clear that entrepreneurship provides a clear pathway to reduce economic inactivity, particularly among young people. Our spotlight has revealed some disparities in the regions and by gender – particularly in Eastern Scotland which appears to be a straggler region across a range of dimensions. The regional disparities highlight the importance of greater examination and tailored support to be directed to “liminal” areas sandwiched between the central belt and the peripheral areas as these can be easily overlooked. Gender parity in opportunities for young women to start a business is encouraging, but the stark disparity in ability to fully establish and sustain businesses is a worrying concern that policy and enterprise support must address."
The report, funded by the Scottish Government and led by the University of Edinburgh’s Business School, also noted that Scotland's startup activity rates remain lower than England's, aligning more closely with Wales and Northern Ireland.
Cabinet Secretary for Economy, Tourism and Transport Stephen Flynn stated it is "incredibly encouraging" to see the record number of people involved in entrepreneurial activity, indicating growing confidence in the country's business environment. He added that the Scottish Government is committed to creating a world-class entrepreneurial economy and providing support to ensure opportunities are shared across all genders, backgrounds, and regions.
