A new survey of 1,300 businesses by the British Chambers of Commerce has found that small firms across the UK continue to struggle with recruitment and staff retention.
In a competitive job market with high numbers of vacancies and low unemployment, attracting and retaining talent is a key priority for businesses - but many firms are struggling to do so, according to a new poll of SMEs by the British Chambers of Commerce (BCC).
From May to July 2024, there were 884,000 vacancies in the economy. The BCC research reveals that 62% of businesses say they are experiencing skills shortages, rising to 74% for manufacturing firms.
The findings also show that 63% of businesses do not have a specific recruitment, training or retention plan for specific groups of workers such as under-25s, the over-50s, disabled or neurodiverse people, or diverse ethnicities.
More and more firms are recognising that flexible working makes good business sense, BCC reports. Contracts that allow working from home, compressed hours and job sharing can help attract and retain staff. The BCC findings show that 14% of businesses say they were unable to hire or retain people specifically because of childcare responsibilities, while 34% see decreased staff morale due to skills shortages.
Skills shortages in numbers
New research by Reed Talent Solutions has found that:
- 75% of HR managers say there's a gap between the skills their organisation has and those it needs to meet its goals.
- 50% of businesses are finding it much harder to hire talent now than they have done in the past five years.
- 76% say they would be likely to consider hiring based on people's soft skills, including good communication, leadership and management, problem solving, work ethic, time management and teamwork.
Wellbeing at work
Health and wellbeing support in the workplace is also now increasingly important to prevent illness becoming a barrier to work. The results of the BCC 2024 Workforce Survey shows that employee uptake of occupational health provision is rising, but fewer than four in ten businesses offer health and wellbeing services. For many SMEs already struggling with rising costs, reducing the tax on workplace insurance and health plans would encourage more employers to offer these services.
"Employees must be supported to find and thrive in work in order to build a resilient workforce fit for the future. In a tight labour market and under high-cost pressures, employers can look to non-pay benefits such as flexible working and health support to set themselves apart. The government should also play a role in removing barriers to work, including better access to occupational health services, to help SMEs and their workforce take advantage of these benefits." Hannah Larsen, policy officer, British Chambers of Commerce.
Corporate social responsibility
Just one in ten businesses reported that they have seen any requests from employees or candidates for evidence of their organisation's social impact. This suggests the initial focus for businesses looking to attract and retain staff should be on employee benefits and flexible working practices.
Written by Rachel Miller.