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Understanding Scotland Economy Tracker – August 2026

The latest Understanding Scotland Economy Tracker for August 2026 shows that,= household finances and the cost of living continue to shape public attitudes. While economic sentiment has improved slightly since May, confidence remains fragile, with many Scots still struggling to make their income stretch and looking for tangible improvements in their everyday lives.

Understanding Scotland Economy Tracker is produced in partnership with the David Hume Institute.

 

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5 Key Takeaways

This edition of Understanding Scotland brings you insights from a representative sample of over 2,000 adults (16+) across Scotland on the most important aspects of our society and economy.

COST OF LIVING REMAINS THE DEFINING ISSUE FOR SCOTS

For the second consecutive wave, cost of living and inflation remains the most important issue facing Scotland nationally and locally. Almost half (47%) of Scots identify it as one of the top issues facing the country, while the same proportion (47%) say it is among the most important issues affecting their local area. As Scotland settles into a new parliamentary term and the UK adjusts to a new Prime Minister, the findings suggest that public perceptions of both governments are likely to be shaped first and foremost by whether people see meaningful improvements in their household finances.

PUBLIC ATTENTION IS BEING SHAPED BY CURRENT EVENTS

While the cost of living remains the dominant concern, this wave points to a public agenda that is responding to developments beyond household finances. Concern about immigration has risen to a record high of 25%, while the proportion identifying social care as a key issue has increased to 13%, its highest level since the earliest wave of Understanding Scotland. Concern about the environment and climate change has also risen sharply to 13%, its highest level since late 2023. Together, these findings indicate that Scots are responding both to cross border political debates, including renewed focus on social care under the new UK Prime Minister, and to major news events over the summer such as heatwaves, wildfires and stories relating to immigration.

ECONOMIC SENTIMENT HAS IMPROVED SLIGHTLY, BUT REMAINS DEEPLY NEGATIVE

Compared with the particularly pessimistic picture recorded in May, Scots are somewhat less negative about both current economic conditions and prospects for the year ahead. However, the overall picture remains challenging. More than two-thirds (68%) believe that economic conditions are worse than they were a year ago, while a similar proportion (67%) expect conditions to deteriorate further over the next twelve months, excluding don’t know’s. Expectations may have become less negative, but confidence in the economy remains weak.

MONEY WORRIES CONTINUE TO SHAPE EVERYDAY BEHAVIOUR

Financial pressures continue to affect the day-to-day lives of most Scots. More than half have reduced non-essential spending (52%) or cut back on leisure activities (51%), while almost half (47%) say they are saving less than usual. Four in ten (40%) report dipping into savings to meet higher costs, while almost a third say concerns about money have affected their mental health (30%) or caused them to lose sleep (29%).

EMPLOYMENT PROVIDES SECURITY, BUT MANY STILL STRUGGLE WITH LIVING COSTS

Scots remain relatively positive about key aspects of work, with almost three-quarters (73%) of those that express an opinion satisfied that their employment provides enough paid hours and two-thirds (66%) satisfied with their job security. However, attitudes towards income are far less positive. Just 37% are satisfied with their income level, while almost half (49%) are dissatisfied with how well their income covers the cost of living. This disconnect is reflected in food choices and spending habits, with 57% reducing takeaways or dining out because of rising prices and 46% shopping for food based on price rather than health