THREE-quarters of Scottish small business owners are suffering sleepless nights over worries about the UK economy, according to a new survey.

They are also more likely than the UK average to be kept awake by ­anxiety over the impact of Brexit on their ­business (19% compared with a 12% UK average), recruiting staff (15% compared with a 9% UK ­average), and the effects of ­unpredictable or ­extreme weather (15% compared with a 6% UK ­average).

Chief among their concerns is ­market volatility, research by Novuna Business Finance found.

The proportion of businesses with worries about this reached 44% in the first quarter of 2024 – almost ­double the proportion from two years ago (26%), and far exceeding the UK average of 35% this quarter.

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Despite the latest forecast from the Office for Budget ­Responsibility (OBR) suggesting that inflation is set to fall below 2% in the next few months, the effects of rates peaking at 11.1% over the previous 18 months have continued to affect the outlook of small business owners.

The data showed that, along with general economic volatility, the ­proportion of small business owners kept awake by concerns over interest rates has peaked this year, rising from 24% last year to 32% this year. Again, this figure is significantly higher than that of the UK average (21%).

Perhaps unsurprisingly given these circumstances, the proportion of businesses struggling to manage their cash flow has risen in the last year from 15% to 23%, making it one of the top three concerns this year.

Joanna Morris at Novuna ­Business Finance said: “Small business ­owners in Scotland might be mildly relieved by the recent stabilisation of inflation rates, but it goes without saying that the long shadow cast by the ­previously high rates and market turmoil witnessed over the past 18 months has had a monumental effect on their outlook and operations.

“As the backbone of the ­economy, small business owners find ­themselves in a relentless battle against ­rising costs and unpredictable market ­conditions, making the task of ­forecasting and managing their financial futures for the long term nigh on impossible.

“Leaders are crying out for a ­period of steadiness, predictability, and above all, certainty. Yet, with three-quarters of business leaders ­admitting to sleepless nights currently, it’s clear they are not finding this ­stability.”

She added: “This data serves as a crucial reminder of the resilience and adaptability required from small ­businesses to navigate these ­tumultuous times.”