New research by NatWest Rapid Cash has identified the various employment hurdles that recruiters and small and medium-sized enterprises (SMEs) are working to overcome, and how today’s trends in the job market are generating new opportunities for the employers and employees of tomorrow.
Highlighted by the findings of the research, roughly a third of surveyed SMEs admitted to struggling with the cost of staffing, resulting in an excess demand within the job market.
The response of surveyed recruiters painted an equally as troubling picture with a massive 85 per cent conveying that businesses are struggling to employ the talent they need.
The lack of available talent is most pronounced in Wales with 93 per cent, closely followed by London with 92 per cent and the East of England with 90 per cent. Beyond the financial services industry, the research also identified that the healthcare, IT and technology sectors were the hardest hit by the shortage of suitable candidates.
Rising operational costs and a squeeze on cash flow mean that offering higher wages cannot be the sole way for companies to fill their vacancies, with the research emphasising how employers and recruiters must look to new ways of attracting and retaining the best talent.
Health and wellbeing benefits have always been valued by employees. But the post-pandemic shift towards hybrid working has increased the focus on work that fits around people’s lives, not the other way around.
Will the four-day working week work?
On Monday 6 June, 70 companies across the UK began trialling a four-day working week model, without employees foregoing a loss of earnings. Based upon the 100:80:100 model, employees still receive 100 per cent of their pay but for 80 per cent of the time, in exchange for a commitment to maintaining 100 per cent productivity.
When quizzed on their views and opinions of this model, 79 per cent of recruiters believe that the four-day working week will become commonplace sooner than 2030, 86 per cent agreed that the model was a good thing (compared to 76 per cent of employers) while happier employees, flexibility and increased employee retention were cited as some of the main benefits.
But the report also identifies potential issues with the 100:80:100 model. These included excessive workload management (44 per cent), potentially reduced output (43 per cent) and that compression into the model could end up costing businesses more (33 per cent).
Understandably, only 21 per cent of recruiters believe that the four-day working week will change the job market considerably in the next year, but this jumps to 61 per cent within a five-year time frame.
In tandem with the release of the research, Natalie Kerr, chief commercial director at NatWest Rapid Cash, recognised the benefits of the four-day working week, and how its advocation for personal wellbeing was already making it a popular choice among employees.
Despite this, Kerr adds that “many businesses are reluctant to provide a better work/life balance due to increased operational costs.”
The post-Brexit landscape, combined with the pandemic, the conflict in Ukraine and the subsequent cost-of-living crisis have all generated operational challenges for SME businesses.
For employers and recruiters to meet the demands of the market, Kerr recommends that businesses “strengthen their working capital,” adding that “cashflow is key when it comes not only to staffing but also to having the flexibility to adopt new models of working and to make the most of growth opportunities.”
And with a four-day working week predicted to have a significant impact on the job market, it will be the companies with the finances to embrace change that will achieve their business goals.