Pick-up signals new challenges for SMEs

2004

As skills shortages promise a bitter battle for talent in some areas during 2004, it appears that small and medium sized enterprises (SMEs) may be taking the brunt of the battle, according to new figures.

The latest Manpower Employment Outlook Survey of 2,500 employers in the UK and 35,000 globally, suggests that small firms have the greatest optimism for hiring intentions this year, way ahead of their larger counterparts.

Taking the balance of firms looking to take on staff compared to those reducing staff numbers, large organizations are left with a ‘net employment outlook' of +2 compared to +11 for medium sized firms and +17 per cent for small organisations.

The Federation Small Businesses (FSB) believes that over the next few years SMEs will be the major job creators in the UK, however, skills shortages mean that they will have to think carefully about how they attract talent:

Recent research from the Learning and Skills Council (LSC) suggested that UK firms are already having problems when it comes to finding skilled people, with 20 per cent of vacancies remaining unfilled through lack of skills.

The LSC report suggests that the lack of basic skills in the country’s workforce costs the UK economy an astonishing £10 billion a year and leaves over 135,000 vacancies unfilled – 44% of employers admitted losing valuable business because of skills shortages.

Commenting on the figures Sue Cheshire, Academy for Chief Executives said: "In a recent poll of Academy members, recruitment and retention are merged as one of the hottest issues for 2004.

"It is encouraging to see that recruitment is finally picking up amongst growing businesses. A real challenge will depend on how SMEs can lever their brands as good employers and attract the top talent they will need to grow"