The latest Aldermore Future Attitudes report reveals that four in five (80%) of SMEs in the IT sector, representing 270,280* small and medium sized business across the UK, find it difficult to hire qualified staff members or keep existing talent in the company.
Hiring and retaining employees is fraught with difficulties for any business. The study, which surveyed over a thousand business decision-makers across the UK, found that the most commonplace concern for SMEs in the IT sector is hiring talented people (40%), with key employee positions often difficult to fill (24%).
Retaining good members of staff once they have been found is a concern for over a quarter (29%) of business leaders in the IT sector, with just under a third (29%) admitting to currently having a problem with a high workforce turnover. A quarter (24%) of companies in the IT sector find it hard to adequately develop employees who demonstrate great potential, and younger employees can be particularly difficult to keep on board (17%). A fifth (20%) say they have experienced an increase in staff leaving their business compared to 12 months ago.
When looking at the reasons behind employees moving onto pastures new, bosses in the IT sector say the most common motive is for a pay increase (22%), followed by a change in career (20%) and retirement (20%). In terms of where they then go, a third (33%) of their employees move to a larger company in a different industry, over a quarter (28%) land a job at a large organisation in the same sector and one in ten (11%) go to another SME in a similar industry.
Most (87%) business leaders in the IT sector recognise they must make an effort to avoid employee churn and to keep the best people. Most commonly they do this by ensuring staff have a healthy work/life balance (34%) and flexible working opportunities (33%), followed by offering relevant training courses (23%) and giving staff regular pay rises (23%).
When recruiting new talent or when replacing staff members who have left the company, networking was the most reliable method of attracting new candidates (22%). Almost a fifth (18%) of business leaders hire external recruitment agencies and one in seven (14%) chose to advertise new roles.
Carl D'Ammassa, Group Managing Director, Business Finance at Aldermore, said: "It's a job seeker's market out there and this trend looks set to continue over the coming years. Talented workers within the SME industry are able to find new employment quite easily, with many individuals moving on when they feel they can get a better deal or could progress further and quicker in a different environment. Competition for the best industry talent has always been fierce and business leaders need to put measures in place to ensure their companies are attractive places to work for ambitious employees.
"The best people can have a significant, positive impact on how that business performs, so therefore it is heartening to see that the majority of SMEs acknowledge that it is important to make an effort to keep talented people by offering a good work-life balance, flexible working, and valuable training. This is to be applauded, and many larger employers could learn much from their smaller peers about maintaining staff satisfaction."
Research was conducted by Opinium Research between 26 and 31 October 2017 with a nationally representative sample size of 1,008 senior decision makers in SMEs.
* SMEs figure – calculated using Federation of Small Business statistics that say the UK has 337,850 IT SMEs (2017 figures). Aldermore Future Attitudes research showed that 80% of SMEs have encountered challenges when hiring qualified staff and retaining good employees. 80% of 337,850 = 270,280