UK employers face talent exodus as economy improves

Almost half (47%) of small and medium sized businesses are worried about staff leaving their organisation now that the economy has started to improve, according to a recent survey.

The Close Brothers Business Barometer, a poll of SME owners and senior management across a range of sectors in the UK, also revealed that 61% of firms are coming under pressure to raise wages.

In addition, 41% of respondents admitted that they now feel the need to incentivise staff to stay with them.

CEO of Close Brothers Invoice Finance, David Thomson, said: “Economic growth will create a higher level of competition for talent, which will understandably see firms change their focus from reducing costs and maximising efficiencies to staff engagement and retention.

“With an improving economy we are likely to see people begin to change jobs in much greater volume than we’ve seen in some years. Employees that have been content to ride out the recession within one organisation may start to look around for more rewarding or enjoyable work.

“Certainly we can expect top performers to look for opportunities to grow and develop, so it’s good that many employers have recognised that this may be something they need to address sooner rather than later.”

Almost half (48%) of those surveyed in the Close Brothers Business Barometer admitted that they are already experiencing increased competition for their staff.

David added: “Our Business Barometer shows that 49% of SMEs polled plan to raise salaries this year, which could arguably be in response to their fears about staff leaving.

“While it may be worrying for employers, the fact that staff retention is becoming a critical issue is a sure sign that the economy is recovering.”