Employment prospects across the UK have received a significant boost after it emerged that almost a third of Britain’s Small and Medium Sized Enterprises (SMEs) intend to recruit new staff in 2014. The research by Clydesdale and Yorkshire Banks also found that businesses which plan to create new jobs expect to grow employee numbers by nearly 10%.
According to the survey, 32% of SMEs intend to recruit new employees, with those who plan to create new jobs saying that they expect to grow staff numbers by 9%. The research found that on average, Britain’s 4.9m* SMEs expect to recruit 2.9% more staff. If this figure is applied to Britain’s total SME workforce of 14.4 m* more than 417,000 new jobs could be created across the UK.
The recruitment intentions uncovered by the research were supported by significant investment plans. Nearly a quarter (24%) of SMEs questioned said they would spend additional money on new staff over the next year.
The survey shows that small businesses (10–49 employees) are the most likely to grow staff numbers, with 63% of firms in this category saying they plan to create jobs compared with 36% of medium-sized businesses (50-249 employees).
Some sectors are set to benefit more than others from the jobs boom, with more than half of professional services and accounting firms (53%) and more than half of manufacturing SMEs (51%) polled citing plans to create jobs. Recruitment intention was lowest among wholesale and retail traders, with just 9% of those questioned planning to hire new staff.
The research also highlighted considerable regional variation. Job prospects are especially bright in the North East where 64% of SMEs intend to hire more staff. Recruitment is also set to be strong in London, where 46% of SMEs signalled plans to increase staff numbers, with the Midlands (44%) and Scotland (43%) following closely behind.
While the majority of businesses (58%) surveyed do not intend to create new jobs, just 2% said they would cut staff numbers, suggesting that the economic squeeze on UK businesses is loosening its grip.
Indeed, the research points to growing confidence among the UK business community. More than half of SMEs (56%) questioned said that the UK economy offers good long-term prospects for business growth, and 97% of respondents plan to invest in growing their business over the next year.
Paul Shephard, Director for Business and Private Banking with Clydesdale and Yorkshire Banks, said: “As the UK economic outlook continues to improve, we are starting to see a positive impact on recruitment plans. Increasing staff numbers can help businesses to boost productivity and competitiveness, and allow expansion into new markets as capacity grows. Creating new jobs is also good for the economy as a whole.
“While our research suggests that many businesses are becoming more confident about investing in their future, it is important that we recognise there remain considerable challenges to growth. SMEs are crucial to the UK economy and its emerging recovery and we will continue to support them in 2014.”
This online survey of 818 middle managers and above in UK-wide SME businesses was conducted by Opinium on behalf of Clydesdale and Yorkshire Banks between 11th and 21st October 2013.