Problems with external mic on M3 Macbook

I rely on an exterrnal mic, as am unable to type well due to stroke. I have a new M3 Macbook air with two monitors. As the macbook needs to be closed to use both monitors, the internal mic is not available. I have a Yeti mic attached to a port on the main external display.

Despite setting the sound input to the Yeti mic and also setting the mic as the source for dication, it only occasionally works. Right not as I type, the dictation symbol flashes on the screen indicating it is active, but it won't dictate what I say. In the sound panel in settings, when test the mic it registers and the input scale moves as I speak. So the Macbook is getting sound input, but it is not dictating even when dictation is active. I have also confirmed the mic is not muted. Dictation is not working in any app, whether apple native or 3rd party.

It has worked at times and is fine, but then other times I get nothing.