Recruitment key to unlocking growth in 2022
14th February 2022
- Nearly a third of medium-sized businesses (30%) in the region intend to increase the size of their workforce in 2022
- South East companies remain optimistic about recovery post-pandemic, with a third of businesses expecting to return to pre-COVID-19 revenues within the next 12 months.
South East businesses plan to hire more people to support growth in 2022, according to new research from accountancy firm, BDO.
Nearly a third of medium-sized businesses (30%) in the region intend to increase the size of their workforce over the next 12 months, with nearly a quarter (23%) planning to pay staff more in order to attract and retain talent.
The bi-monthly Rethinking the Economy survey of 500 medium-sized businesses revealed that South East companies remain optimistic about recovery post-pandemic, with a third of businesses expecting to return to pre-COVID-19 revenues within the next 12 months. Growth ambitions will be supported by new hires, together with an increase in the price of products and services (30%).
However, a shortage of workers and the rising costs of employment could hamper recovery in 2022. When asked about skills shortages, 40% of businesses in the region stated that finding enough people with the right skill-set was their biggest concern, with a particular challenge around the number of available apprentices and entry level workers.
Two years on from Brexit, 27% of businesses are also concerned about a shortage of overseas workers. This is leading to an increased focus on hiring domestic employees, with one in 10 relying on a greater percentage of UK-based workers this year.
Anna Draper, lead partner at BDO in the South East, said: “There’s little doubt that businesses in the region are facing immense challenges when it comes to finding the right people to fill vacant roles. When you couple that with the rising cost of employment, and an impending increase in National Insurance contributions, then South East companies could be forgiven for looking at alternative ways to achieve growth.
“While it’s extremely encouraging to see such optimism within the South East business community, both in terms of the speed at which they expect revenues to return to pre-COVID levels and the confidence they have in the rewards of new hires, there is clearly a real job to be done in encouraging more young people to consider the value of apprenticeships, particularly those from a low socio-economic background who may not consider this route a
viable option for them. The Government’s commitment to apprenticeships through its announcement most recently in the 2021 Autumn Budget, where funding for apprenticeships and the National Skills Fund (NSF) was increased, will undoubtedly help to bridge this gap.”
The Rethinking the Economy survey also found that in 2022 South East businesses will look at a variety of different ways to overcome the problem of staff shortages, with 20% admitting that they’ve been able to hire from a more diverse pool of candidates as a result of the rise in remote working.
As such, nearly a quarter of businesses (23%) said they plan to be more permanently agile in their working practices, including offering greater flexibility for people to work at home / remotely, and being less fixed around working hours. What’s more, nearly a fifth of regional companies intend to introduce a number of new perks in 2022, such as increasing salaries and new joiner bonuses, in order to attract and retain staff.
Draper added: “As a result of the pandemic and other factors, such as Brexit, businesses are having to stretch their thinking when it comes to increasing and maintaining workforce numbers. In fact, nearly a quarter of businesses in the region are having to pay staff more to keep up with inflation. The reality is that these factors will remain front and centre for business throughout 2022 and it’s vital for companies to continue to rethink recruitment and retention strategies to stay in line with an evolving landscape.”