By Gemma Gathercole, Strategic Engagement Lead, ACCA UK
Skills and talent crises have plagued the UK for some time, affecting the growth and success of SMEs, and contributing to the UK’s stagnant recovery. In fact, 50% of UK SMEs report that a lack of skills is affecting their client services, and almost one fifth (17%) aren’t planning to grow in the next year. SMEs can’t navigate the current crisis if they don’t have access to the right talent and make sure that current staff are keeping up with new tools and services. Clearly, more needs to be done to support businesses and deliver growth, and that starts with ensuring that businesses are not only attracting the right talent. but are committed to developing their existing talent with the right resources.
The issues with the current hiring freeze
According to ACCA research, UK SMEs are experiencing significant stagnation in recruitment, with only 12% anticipating new additions to their payroll. The need for businesses to cutback at this time of unprecedented challenge is understandable, and cutting recruitment is an obvious path to take, but it is one that lessons from previous recessions tell us is costly in the long run. To remain competitive in this market, firms must have the right talent to enable them to innovate and remain competitive. Especially at a time where there is a rapid uptake of cloud-based digital systems and a constant change in client expectations transforming how businesses are operating. Essentially, to be successful and grow year-on-year, businesses need to focus on attracting highly skilled entry-level and professional talent and ensuring that the employees they already have are also able to digitally innovate and upskill.
Developing the right talent in-house
Training and developing in-house talent is crucial before SMEs consider external hiring. While skilled talent is scarce, it is vital that staff are able to develop and progress internally and develop the right skills for the business to flourish. Finding “perfect, all-in-one” talent is rare, and so leveraging the experience of the current team and building upon existing knowledge will ensure that their skills can develop in line with the changing needs of the market. Mentorship, intrapreneurship and case-study-based learning can be instrumental to the personal and professional growth of individuals, and, given the rapidly changing nature of the economy, it is important for staff to be able to adapt and transform with these changes.
Attracting new talent
While developing this skilled workforce internally, it is also vital to identify ways to attract and retain new talent. While a challenge, the skills shortage does provide the opportunity for businesses to grow the pool of suitable candidates organically, through new talent initiatives, tailoring their working models to a more flexible approach, and ensuring that innovation and diversity is at the heart of the business.
SMEs would greatly benefit from considering diverse talent pools, such as school leavers on to apprenticeships, recent apprenticeship completers and those who have reskilled. Such programs can be developed quickly; for example, through engaging with local schools and colleges, through to early career initiatives, like work placements for students. This ensures that the skills the business needs are being taught from entry-level upwards. Additionally, with the increase in more flexible working patterns, such as hybrid and remote working, SMEs can explore these underemployed talent pools even more, especially when it comes to helping skilled individuals from a variety of backgrounds return to the workforce.
So-called ‘soft’ skills, such as emotional intelligence and problem solving, are critical and add significant value to the services SMEs provide. These should not be overlooked when it comes to recruiting new talent and nurturing these skills, and providing the tools your team needs to learn more technical abilities will undoubtedly help SMEs retain this talent as well.
How financial services can provide the resources to help SMEs navigate the skills landscape
While there are many services and resources available that can help SMEs recruit and support developing talent, businesses can find these difficult to access and navigate, often not being aware of the breadth of support available. Funding can be scarce and access to loans may not be easy for all. For the future of our economy and SMEs, it’s clear that more needs to be done to improve access and mitigate the ongoing skills shortage. This job falls not only on the public but also on the private sector and industry bodies.
Accounting industry bodies can facilitate collaboration between SMEs and learning providers to take advantage of these training initiatives and provide employees with the knowledge needed to develop their skills. ACCA, for example, offers shorter certificate courses in technological innovation, business analytics, and fintech. These kinds of courses can ensure that staff remain competitive in today’s market and provide them with a great foundation of knowledge, highlighting how the financial services industry can play a crucial role in helping SMEs navigate the skills shortage, which will then boost their growth.
It is imperative that UK SMEs promote skill development, nurture talent pools and enable innovation in order to create opportunities for their current and future talent. Although SMEs must bear some of the responsibility, the financial sector can and does contribute to the growth of SMEs by providing the tools and resources they need.