NatWest Rapid Cash Share Exclusive Insights On Businesses Struggling With Staff Costs
Natalie Kerr, Chief Commercial Director at NatWest Rapid Cash, spearheaded independent research that sought to reveal the employment challenges faced by SMEs and understand whether the current job market trends are making it difficult for businesses to attract new prospects and maintain staffing costs. Natalie now shares exclusive insights on this research with Finance Monthly.
The survey sampled 500 recruitment agencies, 500 SME employers, and 2,000 office workers – all of which are based in the UK.
The research identified that, due to rising operational costs, 34% of SMEs are struggling with staffing costs – which is resulting in a lack of talent uptake. 26% of businesses are also suffering from weak cash flow, making it difficult for companies to progress and keep up with the current changes affecting ways of working.
In terms of what the key evolutions are when it comes to ways of working, employers were asked which trends were the most relevant to the UK market. They elected:
- Four-day weeks – 39.12%
- Five-day weeks – 14.57%
- Completely remote working – 16.77%
- Fully in-office working – 15.37%
- Hybrid – 37.92%
- Flexible working hours – 43.71%
Interestingly, however, employees reported that 71% of them want a four-day work week, standing out above hybrid working (31%) and remote working (28%).
Perhaps employee demands are outgrowing what employees are currently offering, which may in turn cause SMEs to reconsider the perks and working modes available to staff in order to retain and attract talent.
One thing employees, employers, and recruiters could agree on is that the 4-day working week is likely to become the norm by 2030. So, it could be a question of IF rather than WHEN the prospect of new working modes is properly considered.
Implementing, for example, a four-day week would require a wealth of operational and financial considerations. After all, how will it impact communications, client handling, the supply chain, and cash flow?
Surprisingly, though, 40% of SME employers feel their businesses are ready to offer a four-day week. This outshines the 29% of employers who feel financially and operationally unable to offer a four-day week, while a further 31% of the market remains unsure and may take more convincing.
Financing an operational shift can be challenging, and SMEs highlighted finding cover for workload, reduced output, and compression, as challenges that could worsen their financial situation. These factors must be balanced against current challenges, too, with 30% of SMEs identifying late payments from clients as being a pressure point.
Perhaps the external financing market could hold the keys to strengthening SME finances and enabling an operational reshuffle that could see new modes of working introduced, and new talent joining UK businesses.
About the author: Natalie Kerr is the Commercial Director at NatWest Rapid Cash.