To survive and thrive, rural, remote and island communities must be entrepreneurial, innovative, and cooperative. Those that stand still fall behind, losing businesses, people, and services. To Scotland, its rural economy is vital, underpinning its unique culture and strong tourism, food, and drink sectors, as well vital work in science, technology, manufacturing, and services. How can Scotland ensure these rural industries – and communities – are fit for the future?
Scotland’s rural areas pack a punch
Rural Scotland accounts for 98% of the land mass but is home to only 17% of the population and15% of its workforce. Remote rural areas account for 6% of the population and 70% of the land area with over 790 offshore islands, of which 93 of those inhabited.
Yet rural areas provide a huge contribution to Scotland’s economy. Rural Scotland is home to a third of Scotland’s companies, and it was rural businesses which drove the majority of Scotland’s firm productivity growth between before the pandemic. Remote areas alone accounted for 81.3% of total productivity growth between 2010 and 2018, and accessible rural areas, 25%, while urban areas made a negative net contribution at -6.6%.
The future looks bright. Rural Scotland’s businesses and labour markets weathered the storm of the pandemic better than urban areas, and hi-tech firms are setting up shop in the Highlands, such as the Saxavord UK Space Station at Lamba Ness in Unst, Shetland, highlighting the exciting potential for rural communities.
Embracing a new mission
Entrepreneurialism and social innovation go hand-in-hand in Scotland, where often profit isn’t the sole goal. Those involved provide vital goods and services, including healthcare and social services in remote communities where centralised services can’t reach. Meanwhile, old concept businesses, such as distillers of gin and whisky have adapted their historic, profit-driven focus, embracing a social mission – such as the Harris Distillery’s efforts to provide meaningful, local employment and the Arbikie Distillery’s commitment to a wholly circular model.
Building on success
Rural innovation is high on the policy agenda for the Scottish Government. In mid-2023, it launched its Scottish National Innovation Strategy. Coupled with this, developing rural leaders – from all generations – with an entrepreneurial and change-making mindset, has been a central area of ongoing investment via Scottish Enterprise, the government’s economic and trade development agency. In total over 750 rural leaders from all over Scotland, across all sectors and organisation types, including social enterprise, have completed the programme and remain engaged with alumni activities and collaboration.
Collaborations between firms and with universities and academic institutions, for example through Interface, the national government mechanism for supporting university-firm collaborations, and the broader coordination between the Scottish Government and regional agencies will continue to support future innovation. These initiatives alongside strong skills offer for rural and island communities, are part of the future for innovation in rural areas.
In one example, Interface connected a group of organic food growers in the north of Scotland with academic expertise at Scotland’s Rural College (SRUC) to reduce their carbon footprint, . The group wanted to replace their use of peat, transported hundreds of miles, to an alternative seed compost made from locally available materials, which would also avoid the need to use plastic seed trays. The hope is that this project will lead to new business opportunities, as well as reducing the carbon footprint of small-scale horticulture businesses, community groups and private gardens.
Linked to innovation, Scotland’s National Strategy for Economic Transformation has a firm commitment to a just, net-zero transition, to developing rural women, strong intergenerational connections and young rural people with their enterprise skills and to further develop the well-being economy.
In the Outer Hebrides, one such connection was made by, Miriam Hamilton, who, in her early 20s, started her own weaving business, The Weaving Shed, based from her home on the Isle of Lewis. The fabric is the iconic Harris Tweed, which she creates on an old, heritage loom bought from a local octogenarian, who has imparted his knowledge, and supported her, to learn to learn the ancient art of weaving on these islands.
Together, these policies provide strong foundations for the future of Scotland’s rural communities. Now we must work together to build on them to make them thrive.
A new report from the OECD provides new insight into rural innovation in Scotland. More information on the report can be found here.
Jane produced four podcasts during the process of developing the Enhancing Rural Innovation Report for Scotland.
Episode 1: Michelle Marshalian, OECD – In this Episode, host Jane Craigie, speaks to Michelle Marshalian, OECD’s lead author of these reports. Michelle speaks about what rural innovation spans, and what OECD discovered in Scotland. https://www.buzzsprout.com/2251719/episodes/13638896
Episode 2: Phil Raines, Scottish Government – Phil discusses why Scotland became involved with the OECD Enhancing Rural Innovation Project, what rural innovation means to Scotland’s rural places and communities and his observations about Scotland’s rural economy. https://www.buzzsprout.com/2251719/episodes/13643632
Episode 3: Julian Pace, Scottish Enterprise – Julian has had a long history with Scottish Enterprise, he founded the organisation’s Rural Leadership Programme and was instrumental in developing Scotland’s relationship with the OECD Rural team. https://www.buzzsprout.com/2251719/episodes/13643636
Episode 4: Rob Clarke, Highland and Island Enterprise – Rob talks about the Highlands and Islands of Scotland, the OECD project and rural innovation’s importance to Scotland’s economy. https://www.buzzsprout.com/2251719/episodes/13643638
Jane Craigie is a Chartered Marketer with over 25 years’ experience in marketing within the agri-food sector. She is a member of the executive board of the International Federation of Agricultural Journalists and the council of the British Guild of Agricultural Journalists. Jane is a graduate of the IAgrM and Scottish Enterprise Rural Leadership Programmes, is a Windsor Leadership Alumna and a Waitangi Scholar. Board member for Lantra and a Professional Agriculturalist (P.Agric) and RingLink Scotland. Jane is a Director and co-founder of the Rural Youth Project.