Scary numbers

The independent study by Robert Half UK made for sobering reading for the owners of SMEs all over the country who are already straining against the economic and political uncertainty of Brexit and some of the most deflating A-Level results nationwide since records began. The study estimates that the cost to the average UK small business will be £145,000 in 2020. Furthermore, the skills gap is only predicted to widen, leaving business owners to make up the shortfall with more comprehensive training and onboarding.

By 2025 the skills shortage could cost the average UK business as much as £318,000.

Macro challenges

So, what’s the reason for this worrying, and potentially profit-sapping shortfall? The study cites a number of macro-challenges which are key factors in sluggish UK productivity which is the lowest out of all the nations in the G7.

In the wake of the once again delayed Brexit, the UK will likely face a shrinking pool of talent. Other economic influences including a potential recession and an increasing shift towards a heavy automated and digitised economy are also cited as key influential factors.

Historically, political and economic uncertainty have a stifling innovation as well as preventing UK businesses from establishing themselves in new markets.

The study mentions a number of hard and soft skills required to help close the skills gap including critical thinking and adaptability as well as the ability to analyse and interpret data and demonstrate proficiency with digital applications.

Business owners worried

The research highlights a number of concerns for owners of SMEs across the country in this testing time;

• 59% were worried that a recession would negatively impact their business
• 47% felt that Brexit would negatively affect their business
• Only 26% said that Brexit wouldn’t affect their skills gap.

Business leaders respond

94% of CFOs interviewed in the study believed that it was up to them to help their employees become more resilient to help them to succeed in a challenging geopolitical climate.

63% of business owners said that they intended to further train and upskill their existing staff. 42% were planning on hiring more permanent staff while 27% said that they were going to hire more temporary employees while 74% said that they would supplement their workforce with temps to upskill their teams.

Robert Half UK’s Managing Director Matt Weston had this to say:

“For SMEs, the priority for the next year should be identifying and filling gaps within their organisation. Training and development initiatives, with a focus on upskilling existing staff, are the obvious starting point. At a time when change is the only constant, adaptability and resilience will be the key soft skills to develop.

“The solution to the war for talent is a blend of permanent, temporary and interim employees.”

Manage the cost of a shrinking talent pool

Whether it’s training and upskilling staff, or managing the cost of reduced productivity, a business loan through Century Business Finance could help. Find out if you’re eligible today.