How can SMEs improve retention and recruitment?
SMEs are the lifeblood of the UK economy, with over 99 per cent of UK businesses falling into this category. Overall, SMEs employ around 60 per cent of all employees in the private sector. However, there remains a well-documented struggle for this sector to compete in recruitment and retention of skilled employees.
In theory, working for SMEs rather than large corporates has many advantages for employees. This includes greater flexibility, closer connection to the visions and goals of the business and increased personal responsibilities. The reality, however, can be a little more challenging. When deciding who to work for, employees will often choose larger businesses simply because of the perceived extra resources and workplace benefits offered by the larger organisation.
Smaller employers are increasingly aware of the need to attract and retain a skilled, motivated workforce, especially where they may not be able to compete with larger businesses on pay or business profile.
Employees are Looking for a Range of Workplace Benefits
Statistics from recent research by Metlife UK show that 35 per cent of SMEs with between 50 and 99 staff lose out on new recruits because their benefits package is not competitive and 29 per cent say their benefits package actually puts potential employees off.
A separate study by group risk provider Ellipse shows just how important a workplace benefits package is to employees; 63 per cent of 1005 SME employees polled said that workplace benefits were either a valuable or extremely valuable part of their overall employment package.
There is clearly a desire from employees to have a competitive range of workplace benefits, but employers do not appear to have responded; in Ellipse’s survey of 500 SME business leaders, 43 per cent said they offer no workplace benefits other than the (now mandatory) pension scheme.
Why is this the case? Perceived cost will surely be a factor, with SME budgets stretched at the best of times. SMEs often have a minimal HR function, so perhaps there is simply no internal drive to extend the benefits offering. Perhaps they have traditionally had very limited access to expertise on workplace benefits and have been put off by perceived complications in rolling out new benefits.
A Changing Benefits Market Means More Options for SMEs
The good news is that the benefits market for SMEs has been changing over recent years. Providers are now able to offer benefits schemes to SMEs which are of equivalent quality to those provided to large corporates, allowing SMEs to start competing on a level playing field.
Voluntary benefits are becoming more commonplace in the market, as they offer employers a chance to provide access to a benefit that may be of interest to an employee, but often at little or no cost to the business.
Finally, technology in the benefits sector has finally switched on to the needs of SMEs. New benefit platforms are now available to smaller employers at far lower cost than used to be the case, where previously well-established flexible benefits platforms could be offered but at a prohibitively high cost for most SMEs.
A well designed and correctly tailored benefits offering, combined with a benefit platform to bring together all those benefits in one place for employees to access, can make a significant difference in the recruitment and retention battle faced by SMEs and with benefits technology evolving, going the extra mile for your employees is more affordable than ever.
This article was provided by Busy Bees Benefits.
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