The latest ONS figures show that UK employment is at a record high, and its small businesses that play a pivotal role in job creation. A report from Capital Economics and npower Business demonstrates that SMEs have contributed to more than 70 per cent of private sector employment growth since 2011.
Despite ongoing economic uncertainty, small and micro businesses will continue to play a crucial role in job creation. But while these companies are the bedrock of economic development, our experience of working with millions of business owners in the UK tells us that their size can also generate certain barriers to recruitment.
Although some of these factors are outside of their control, there are steps business owners can take to ensure they’re in the best position possible to attract and recruit employees and continue to achieve their potential as job creators:
Bridging the skills gap
The skills gap is a hurdle to businesses of all sizes, but one that is seen to disproportionately impact smaller companies. However, we’re hearing a more complex picture from our customers on the ground.
Small businesses operating in certain industries, such as construction or tech, are certainly more susceptible to skills shortages. But one customer recently shared with me the need for business owners to tap into under-utilised and highly skilled employees that may fall under their radar.
A great example of this are parents who left high-flying careers and are unable to return to full-time work. This is a valuable resource for small business owners, as the flexibility they’re looking for can be turned into an advantage if you’re not able to hire a full-time employee.
There’s also a case for looking beyond CVs when recruiting. Previous experience is valuable, but the hiring needs of small and micro businesses can be different to those of larger firms that offer more structured and linear career paths.
In smaller businesses, employees need to demonstrate versatility and willingness to take on varied responsibilities as part of a close-knit team. To find employees who will rise to this challenge, hire for attitude and interpersonal skills first, and then provide training for technical elements of the role.
Leveraging size as an advantage
Small and micro businesses can appear to be at a disadvantage when it comes to attracting employees, especially if they lack a dedicated HR function or a comprehensive benefits package like some of their corporate counterparts.
But in reality many employees prefer working for smaller companies. According to a survey by LinkedIn, UK businesses that employ ten or fewer employees report the highest levels of job satisfaction.
Small business owners may need to work harder to get employees on board, but you can achieve great results by leveraging your company’s unique qualities to stand out against larger enterprises.
While employees may feel like a cog in the machine at a large company, one micro business business owner told me that a key selling point for her employees is that they feel like an integral part of the business’s journey and that they are making a tangible impact.
Whether you’re developing and launching a pioneering new app, or running a business that serves your local community, your employees will be able to see your dream unfolding every step of the way and play an important role in achieving it.
Emphasise this unique benefit in all your conversations with current and potential employees to keep them updated on the progress you’re making, any major milestones and how they could become involved.
Inspiring future entrepreneurs
The responsibility for job creation should not only lie with business owners, especially as many of them will remain sole traders by choice. It’s equally important to encourage more people to start their own successful companies.
The UK’s startup rates are promising, but there are still many businesses that don’t survive beyond five years. There are certain characteristics that influence success, and our survey about the personality traits of small business owners vs. full-time employees found the former were more likely to be passionate about work, have a strong character and be confident.
The good news is that there is a wealth of advice and guidance to support aspiring entrepreneurs and give them the best chance of success. A great place to start is by seeking advice from seasoned business owners. Many will have encountered the same roadblocks as those who are starting out, and are often willing to share their experiences and learnings.
As the country’s foremost job creators, finding, attracting and retaining the right employees is critical not only to small and micro business owners’ success, but to the wider economy.
By Simon Braier, head of customer insights at Vistaprint UK