Scotland’s £110 billion success story as mid-market businesses continue to grow

Britain’s mid-market businesses have continued to grow in 2026 despite ongoing economic uncertainty, with Scotland emerging as one of the strongest growth stories.

Data from BDO, the audit, tax and consulting firm, reveals that the number of mid-market firms north of the Border has increased by 5.1 per cent year-on-year, outpacing the UK-wide national growth rate of 4.4 per cent.

Scotland is now home to more than 2,000 mid-market companies - defined as businesses generating revenues between £10 million and £500m, including market-quoted and private equity-backed firms, according to the report.

James Paterson, head of tax at BDO in Scotland.

BDO noted that those businesses now contribute some £110 billion to the UK economy. The sector also supports more than 490,000 jobs across the country.

Across the UK, the mid-market now contributes £2.44 trillion to the UK economy and accounts for more than one in three private-sector jobs, despite representing less than 1 per cent of UK businesses. The firm said Scotland’s continued expansion highlighted the important contribution regional businesses are making to the UK’s overall growth ambitions.

James Paterson, head of tax at BDO in Scotland, said: “The mid-market has huge growth potential. These businesses create high-quality jobs, deliver local investment, and drive innovation, and it is particularly encouraging to see the number of these businesses expand across Scotland, defying challenging conditions.

“Where some sectors’ growth is stagnating, it is essential that we listen to the signals and provide them with the support they need to make sure we are not holding back this engine of the economy.

“Mid-market businesses often fall into a policy gap as they are too large to benefit from targeted start-up support and too small to influence government policy or win the recognition that the largest corporates command. With the right support, they can continue to play an outsized role in delivering economic growth,” he added.

BDO has published a “Mid-Market Manifesto”, which comprises a series of calls to action for government to maximise the mid-market’s growth. This includes measures to address skills shortages across sectors and regions, rolling out a “clearance-style” apprenticeship scheme, and incentivising and supporting small and medium-sized businesses to offer young people work experience.

To boost growth in the advanced manufacturing sector, the manifesto urges the government to implement a “one-stop shop” for mid-sized business export support, reduce energy costs and clarify eligibility for the British Industrial Competitiveness Scheme (BICS), while supporting mid-market businesses to identify and adopt new technologies.

Shevaun Haviland, director general of the British Chambers of Commerce, said: “We know that helping mid-market businesses to grow and thrive can have a significant impact on economic growth, with a 1 per cent increase in growth potentially adding £35bn to the UK economy.

Therefore, we welcome this timely report from BDO, setting out policy measures to support investment, productivity and international competitiveness.

“In our most recent quarterly economic survey, half of responding firms said that they were now more concerned about taxation than they had been three months ago. Simplifying the tax system through measures outlined in this report would have a tangible impact on business growth.”

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