Team Scotland's inward investment support: evaluation

7. Conclusion

It is clear from the analysis of the management information data and the beneficiary survey responses that the landscape of UK based/abroad-owned businesses in Scotland is more diverse at the start of the 2020s than in any previous time periods. Scotland has a large SME community (99.4%), some of which are inward investment companies: the vast majority of those that responded to the survey (81%) were SMEs^[16]. Firms' responses highlighted the impact and benefit that support had on their project, leading to further benefits to suppliers and customers as an extension of doing businesses in Scotland. About half of surveyed firms reported that knowledge and/or expertise transfer activities occurred between them and Scottish suppliers, business customers and Scottish universities/colleges. These activities resulted in a variety of impacts such as new or improved business processes, improved product quality, and R&D studies.

Analysis from this evaluation also shows that jobs associated with inward investment were realised in practice. Total actual new jobs were estimated to be 5,297^[17] over the evaluation period, while actual safeguarded jobs were estimated to be 5,863^[18]. Survey data also showed that some firms achieved additional job outcomes, over and above planned jobs. Moreover, anticipated job creation over the next three years from the survey revealed that the majority of firms plan to increase the number of actual jobs in the future.

The delivery of this evaluation required a consideration of the wider context in which investment was taking place. The COVID-19 pandemic had a substantial impact on business investment and unprecedented government policy interventions affecting the movement of people and providing financial assistance were made within the evaluation period. In addition to experiencing other external events that negatively affected their performance, the negative impact appears to be worse than anticipated as there was already a downward trend in the number of planned jobs between 2018 and 2020. The majority of businesses (80%) reported that their investment project was affected by at least one negative factor, e.g., COVID-19, EU-exit, or other such as global supply chain disruption over the period. This could not be balanced by a small proportion of firms (11%) that reported that their investment projects were positively affected by some external factor. For the majority of businesses (83%) negative factors resulted in a decrease in the number of people employed and project delays.