Understanding Scotland Economy Tracker August 2026

Tracker survey reveals financial strain is impacting people's daily lives, leisure activities and health.

The latest Understanding Scotland Economy Tracker published by The David Hume institute in conjunction with Diffley Partnership surveyed 2,186 adults across Scotland between 2 and 5 August 2026. 

The survey has been tracking public opinion and behaviour on the Scottish Economy since October 2021.

The latest esearch reveals the ongoing cost of living squeeze remains a dominant issue for Scots.

Almost half (47%) identify inflation and living costs as one of the most important issues facing the country for a second consecutive quarter.

The latest findings suggest an increasingly anxious public where financial strain is directly impacting daily life, leisure and health.

Other key findings include:

●      More than two-thirds of Scots who expressed an opinion (68%) say the economy is worse than it was a year ago.

●      A similar proportion (67%) expect economic conditions to worsen over the next 12 months.

●      Only around a quarter of Scots (24%) believe things in Scotland are heading in the right direction.

The survey also highlights how economic pressure is shaping everyday behaviour across Scotland:

●      More than half of respondents (52%) say they have reduced non-essential spending because of concerns about money matters.

●      A similar proportion (51%) say they have cut back on leisure activities.

●      Four in ten Scots (40%) say they have dipped into savings to meet higher costs.

●      Three in ten say concerns about money have affected their mental health (30%) or caused them to lose sleep (29%).

Research: The Great Risk Transfer - have we got the balance right?

Image credit: Photo by Cindy Tang, free from Unsplash 28.09.2022.

How many people have the knowledge and time to manage the financial risks they face in life? To what extent does it matter?

We partnered with the Institute and Faculty of Actuaries (IFoA) to explore these questions. We aimed to find out more about what people in Scotland understand to be the key risks in relation to their long-term financial wellbeing and what helps and holds them back from addressing them.

Our engagement with people in Scotland was designed to build on recent work carried out by the IFoA which has been exploring the ongoing trend of transferring risks from institutions – such as employers, the state, and financial services providers – to individuals.

The IFoA calls this the ‘Great Risk Transfer’ describing it as posing one of the most significant yet little understood social, financial, and political challenges of our time. The changes described in this work show that far greater responsibility is being placed on individuals for managing their lifelong financial wellbeing than has been the case for most people living in Scotland since the establishment of the modern welfare state.

The Great Risk Transfer research showed that the causes of this trend are complex. They include increasing life expectancy, technological advances, changes in financial regulation and political choices. The IFoA highlighted four important areas of risk transfer: pensions, work, health and insurance. Our work was designed to find out more about relevant perceptions of risk in the Scottish population and how people respond to risks which can affect their financial wellbeing.

We explored people’s awareness of the Great Risk Transfer and their ability to manage and respond to financial risks. This revealed two interlinked themes which have implications for policymakers and others interested in either mitigating against or rebalancing responsibility for the relevant risks.

• Cultural – what people know, how they feel and what they do to manage risk

• Structural – the wider social and economic system

Our work commenced in December 2021 and concluded as inflation grew to levels not seen since the early 1980s, with rapidly-increasing fuel, energy and food prices dominating the headlines. This comes at a time when wages and social security payments have generally not kept pace with inflation, leading to widespread acknowledgement of a significant rise in the cost of living.

Not surprisingly, many of the people we spoke to were focused on immediate financial challenges. These included high housing costs, insecure tenancies and jobs, low incomes and debt, and, for some retired people, the challenge of living on a fixed income. This report is structured around four key areas which emerged strongly in our research:

• Knowledge and awareness of risks to financial wellbeing

• Trust in information providers

• Stress, fear, stigma and embarrassment

• Ability to access and understand guidance and information