Small Businesses Predict Hiring Boost

New CIPD Figures Have Shown A Boost In Hiring Optimism Among SMEs

13.05.2014

Steven Beahan, Partner | +44 (0)114 294 7868

Small businesses are five times more likely to employ staff in the next quarter than large businesses, according to new figures from the Chartered Institute of Personnel and Development (CIPD).

The balance of small firms that predict they will increase staff levels in the second quarter of 2014 currently sits at +52, compared to +11 for bigger corporations. Any figure above zero indicates growth.

But despite this optimism, the CIPD has urged companies to be careful in hiring staff and has warned SMEs they must be measured in their approach to new talent, as there are serious risks in taking on too many people too quickly.

When SMEs were asked about the future of their business, 77 per cent agreed that their success hinges on them "staying true to their vision", but 17 per cent of executives believe their colleagues would struggle to articulate what this vision actually is.

In order to cement the importance of a company's values, the CIPD claims that it is important staff members are educated on where the SME expects to go in the future and how managers expect growth to impact on operations.

Dr Jill Miller, from the CIPD, said: "We know that having a clearly articulated purpose and values is vital for business success, and our research among SMEs shows that they wholeheartedly agree.

"However, there is a danger that if these values are not a living part of daily operations, they can become diluted or even disappear as the business changes and the workforce grows."

To help executives construct a value system for their company, the CIPD has issued a guide to assist in the creation of a long-term "vision", which includes case studies from 16 organisations in a range of sectors - including Naked Wines, Secret Escapes and UKFast.

Many of these firms started out as SMEs, but credit their corporate vision with rapid growth and increased turnover.

Expert Opinion
With more and more positivity emerging across the business world, it is unsurprising that such confidence is filtering through to small businesses – with many looking at boosting their workforce in order to push forward with growth.

"However, it is important that small businesses recognise that developing and expanding staff number is about more than recruitment.

"Ensuring that those who join the firm are given the right introduction to the business and its values is hugely important, as it means they are aware from the outset of what the company is trying to achieve and where they sit within it.

"This is particularly vital when it comes to ensuring staff, including top performers, are motivated and switched onto where the organisation is going."
Steven Beahan, Partner