<b>Scotland’s sea fishing sector – </b><b>A q</b><b>ualitative case study o</b><b>f business experiences</b>

<p dir="ltr">SRUC researchers working on the Scottish Government-funded <a href="http://www.nisrie.scot/" target="_blank">Novel Insights on Rural and Island Economies (NISRIE)</a> project used a n<b>arrative study approach to generate contextual, but subjective, evidence from businesses operating in the sea fishing sector.</b> This research explores o<b>ngoing challenges and opportunities facing sea fishing businesses - a sector that has a vital role to play in the economic and social vibrancy of many coastal and island communities across Scotland</b>. The reports provides some background context on the economic importance of the sector to many coastal and island communities, and then provides narratives from a small number of interviewees on their recent ‘real life experiences’ operating sea fishing sector businesses during a turbulent period that saw the UK leave the EU, the Covid-19 pandemic disruptions, the cost-of-living crisis, as well as other legislative and policy proposals and developments.</p><p dir="ltr">In late 2023 – early 2024, the NISRIE team undertook four in-depth, online interviews with representatives of fishing businesses and organisations from the fishing sector in coastal and island communities across Scotland. The sample included a range of ownership structures and business types in a geographical spread of locations across rural and island Scotland. The narrative inquiry approach utilised was designed to elicit subjective perspectives on the business operating environment faced by selected businesses and is not designed to be representative of the wider fishing sector.</p><p dir="ltr">As with all sectors in rural and island locations, the operating environment is fluid, and <b>the research report only provides a snapshot of views from those interviewed at that point in time</b>.</p><h4><b><u>What did we learn?</u></b></h4><p dir="ltr">Scottish fishing businesses interviewed reported that they had f<b>aced a challenging few years: in adapting to new markets, reporting procedures, and post-EU exit supply chain arrangements - as well as other disruptions and pressures, including Covid-19 lockdowns and rising operating costs</b>. In addition, new regulatory controls, as well as increased challenges in accessing migrant labour, had created significant pressure on fishing and fish processing businesses, as well as the sector as a whole.</p><p dir="ltr"><b>Fishing was a key sector of focus during the negotiations over UK’s withdrawal from the EU.</b> Whilst the sector was generally perceived to be largely supportive of EU exit, this view of the sector was perpetuated by pro-EU exit campaigners and was not universal across the sector – indeed, it differed amongst sub-sectors . Those in favour of EU exit were driven by an interest in greater autonomy of fishing stock controls in UK waters, despite the UK being a net importer of seafood and c.80% of fish landings being exported in 2020. Interviewees suggested that the outcomes of post-EU exit negotiations for the fishing sector were much less radical than some envisaged. Interviewees suggested that the protection of UK waters and fishing stock had not led to UK produce being more competitive, rather produce was still having to compete with bigger trading agents like Norway and Iceland on the European export market, while having reduced access to North Sea fishing, as well as facing continued obligation for fish stock data reporting to the EU.</p><p dir="ltr">The sector also f<b>aced uncertainty in the prolonged lead-up to EU exit,</b> as well as some initial supply chain disruption (export) in the immediate aftermath of EU exit transition that ended on 31 December 2020. It was reported that many of the initial impacts had been resolved relatively quickly, and the immediate impacts were smaller than anticipated. However, additional paperwork, inconvenience and cost in accessing fishing equipment imported from the EU remained - affecting smaller businesses disproportionately.</p><p dir="ltr">The <b>ending of the freedom of movement of workers following EU exit was reported to be significant for commercial fishers and fish processors</b>, with resultant increased requirements for migrant labour access. Most notable was the £38,700 salary threshold for Skilled Worker visa eligibility introduced by the UK Government for new visa applicants from April 2024 . This threshold was reported as incompatible with many jobs in the sector, particularly with the common practice of paying boat crew a proportion of catch revenue as part of their earnings.</p><p dir="ltr">Of the three ‘crises’ discussed in this study, <b>Covid-19 was considered the least significant in terms of impact on the fishing sector and businesses by the interviewees</b>. Despite changes to market trends and outlets for fish and seafood during early lockdowns, with hospitality businesses closed and restrictions on the fishing fleet to comply with social distancing regulations, several interviewees felt that Covid-19 helped to buffer and reorient the industry during the EU exit transition. One business identified Covid-19 as prompting an <b>overhaul of routes to market</b>, resulting in significant business and value growth through direct sales. At the same time, another linked the restrictions on catches and financial support available for the sector in early lockdown as helping mitigate the detriment of EU exit on fish prices and business viability.</p><p dir="ltr">Following the Covid-19 pandemic, <b>increased fuel costs and interest rates</b><b> </b>(important in relation to borrowing against newer vessels) were noted as having significant impacts on fishing businesses, with some businesses deciding to sell-on or close the business after decades of trading. The timing of the <b>cost-of-living crisis</b> was, as for the accommodation sector , especially challenging in a year where many businesses hoped to ‘bounce back’ from the previous two years of Covid-19 restrictions.</p><p dir="ltr">Overall, k<b>ey challenges facing the Scottish commercial fishing and fish processing sector that were identified by interviewees include</b>:</p><ul><li><b>Attracting domestic and migrant labour force</b><b> </b>in the face of reduced access to EU labour, increased wage costs, and competition with other rural and coastal industries (e.g. aquaculture and renewables), alongside more stringent requirements for Skilled Worker visa eligibility;</li><li><b>Provision of suitable accommodation for labour</b>, particularly for inshore vessels, but also supporting businesses and roles onshore, such as processing, at harbours and markets. This was of particular concern following the impacts of Covid-19 and the cost-of-living crisis of affordability of housing, especially in scenic coastal locations;</li><li><b>The impact of ‘spatial squeeze’ on the areas and methods available to commercial fishing</b>, and working alongside other marine stakeholders and resource competitors (e.g. oil and gas, renewable energy, conservation, etc.) to balance management options for multiple outcomes;</li><li><b>Increasing capacity and adaptability of fish processing</b> to changing fish stock quotas and availability, and enabling value addition for the Scottish fishing sector;</li><li><b>Evolving systems of data reporting</b> on fish stocks, catches and management post-EU exit, that can strengthen outcomes for Scotland’s fishers in international negotiations.</li></ul><p dir="ltr">Despite the challenges facing the sector, across these narrative research interviewees, there remained a sense of optimism about the current and future state of fish stocks (despite stakeholder and scientific concerns), as well as ongoing investment in upgrading the current fishing fleet, and the role of Scottish fishing in contributing to national strategies on food sustainability and security.</p>