SMEs Losing Talent Battle on Benefits
SME bosses are losing out on attracting and retaining staff because the benefits package they offer is not as strong as competitors and would-be staff are choosing bigger employers, new research from MetLife UK shows.
Its study of companies employing between 50 and 300 staff – which make up to around 34,000 businesses with an annual turnover of £541 billion and employing 3.3 million people – found attracting staff is a bigger challenge than growing profits and improving cashflow.
Bosses rated it as the second biggest challenge they face narrowly behind coping with Brexit-related uncertainty with companies employing between 100 and 200 staff saying attracting staff is their biggest challenge.
Companies are split over why talent attraction is such a major worry with 37% blaming competition in general. However, nearly a third (29%) say their benefits package puts potential employees off while the same number say they lose out to bigger firms, the MetLife UK study found.
The benefits effect is particularly acute for companies employing between 50 and 99 staff with 35% say they lose out on new recruits while 34% of companies with 200 to 299 staff say they lose out to bigger employers.
MetLife’s study found growing demand for support in attracting new staff – more than half (55%) of firms say they would value help from consultants on how to attract new staff but just 36% will go ahead with seeking help in the next 12 months. The other 19% say they cannot afford to invest in support.
Adrian Matthews, Employee Benefits Director, MetLife UK said: “SME owners and managers are coping with a wide range of issues and increasingly value specialist support with business challenges which are outside their areas of expertise.
“Well-designed benefits packages can play a major role in enhancing the value proposition for would-be employees but SME owners do need support in establishing which benefits to provide and then in ensuring employees value them as well as how to do so in a cost-effective manner.
“Group Life and Group Income Protection are benefits that employees value and cost much less than employers often think – for example, around 0.5% of salary for income protection and 0.2% of salary for life.”
“It is encouraging that so many firms are considering investing in support but at the same time too many companies are put off asking for help because they do not believe they can afford it.”
MetLife’s research found around two-fifths (39%) of SMEs plan to access support on adapting to new technology over the next 12 months while 36% will ask for help on improving productivity. Around 29% are looking for help in sourcing debt finance.
MetLife is focused on expanding its business among large corporates including multi-national clients as well as SMEs and enhancing strategic partnerships with leading brokers and EBCs.
It is established as the UK’s third largest Group Life provider by number of schemes it insures and the sixth largest Group Income Protection provider by in-force premium.