

The hospitality sector has produced the most new businesses in the first half of the year, despite figures showing jobs continuing to be lost under rising costs.
Hospitality was the stand-out sector with an 18.7% rise in startups (2,131) in Scotland in the first six months of this year over the last half of 2024, according to the New Startup Index from NatWest and Beauhurst.
However, other data from the British Institute of Innkeeping (BII), the British Beer & Pub Association (BBPA), UKHospitality and Hospitality Ulster shows 84,000 hospitality jobs have been lost since the Budget, which imposed an additional annual cost of £3.4 billion on the sector.
In a joint statement, the trade bodies said: “This shocking data reinforces the urgent need for Government to recognise the incredible pressure hospitality businesses have been put under, particularly since April, and illustrates why it should come forward with measures to support this vital sector at the Budget.
“Unsustainable tax increases are squeezing businesses, stifling growth and investment, and threatening local employment, especially for young people.”
Despite the pressures on hospitality, it was the most active sector for startups in Scotland with a 17.9% increase in all new business incorporations, second only to the North East.
Aside from startups there have been a number of growth stories in the hospitality sector, including investment at Crieff Hydro and expansion of Six by Nico restaurants. The Old Manse of Blair, a five-star independent boutique hotel and restaurant in the Cairngorms National Park, Highland Perthshire, has reached a significant milestone with sales exceeding £5 million for the first time.
Founded and developed by Anne MacDonald, it was recently visited by Scotland’s First Minister, John Swinney, who discussed staff recruitment and the impact of upcoming policy changes including the visitor levy.
The latest New Startup Index found property development and construction recorded 1,316 new startups, up 23.1%, and tradespeople and trade services experienced the highest sectoral growth at 27.1%, with 1,305 businesses launched.


The figures may come as a surprise in view of concerns over rising labour and energy costs and a continuing caution among consumers.
Ten UK regions recorded a rise in startup activity in the first half of 2025, signalling renewed confidence in the UK’s entrepreneurial landscape.
The North East saw the fastest growth compared to the second half of 2024, with a 19% increase in the number of startups, totalling 10,400.
Other regions also posted strong gains: the West Midlands by 16.9%, and the North West by 16.5%. Overall, 426,000 new businesses were registered with Companies House in the first half of 2025. This follows a volatile 2024, which began with a record 468,000 incorporations in H1 but dipped to 378,000 in H2 – the lowest quarterly level since 2021.
James Holian, head of business banking at NatWest, commented: “The first half of 2025 has shown that the UK’s entrepreneurial spirit is not only alive but accelerating.
“What’s particularly encouraging is the surge of innovation coming from regions like Scotland, which has emerged as the second fastest-growing area for startups in the UK. This momentum reflects the depth of talent and ambition among founders up and down the country.
“Entrepreneurs and startups are vital to our economy and at NatWest we’re proud to have supported over 10,000 new businesses through our NatWest Accelerator programme, creating 12,000 jobs, and driving £700 million in investment so far.
“This year, we’ve raised our ambitions even further by welcoming another 10,000 entrepreneurs to the programme, launched a £1 million funding competition for small business owners, and expanded our digital support through the new NatWest Accelerator app.
Lord Livermore, Financial Secretary to the Treasury, said: “It is extremely welcome to see startup activity increase in ten separate regions, helping to deliver jobs and investment in communities right across the UK.
“Through our £120 billion capital investment in growth-generating projects, our Plan for Small and Medium Sized Businesses and our Industrial Strategy, we are backing Britain’s entrepreneurs and startups to expand further, grow faster and create more well-paid jobs.”
Henry Whorwood, managing director at Beauhurst, said: “It is encouraging to see some recovery from the incorporation volumes seen at the end of 2024.
“Whilst still down from previous first halves, this recovery is impressive when against a challenging macro background, and policies announced in the Budget that were antagonistic to entrepreneurs.”
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