A survey of 275 island firms by the Federation of Small Businesses (FSB) has revealed 88% of respondents stated they faced other challenges that their mainland rural competitors did not.

Five key areas for action which were identified include:

Survey results were gathered from islands including Shetland; Orkney; the Western Isles; Skye and the Small Isles; the Argyll Isles (including Bute); and Arran.

Ahead of planned legislation aimed at giving island authorities new powers, the FSB in Scotland has called on politicians and officials to address these problems.

David Richardson, the FSB’s development manager for the Highlands and Islands, said the prosperity of a local place is “intertwined with the ongoing success of its local business community”.

He added: “While this rings true across the country, it is particularly the case for Scotland’s island communities.

“Our survey work shows, perhaps unsurprising, that addressing shortfalls in digital and transport infrastructure is a top priority for island firms. But – ahead of these problems – local businesses want to play a role in developing sustainable island communities. In our view, only with a successful local private sector can our islands succeed.”

Mr Richardson, who is giving evidence to the Rural Economy committee today, said: “Micro businesses and the self-employed are vitally important to island economies. But our research shows that one in five islands business owners has considered moving to the mainland.

“To state the obvious, the long-term success of island communities require their local private sectors to thrive, to power job creation, local growth and to retain and attract younger residents.”