Daily News

View All News

Europe – Companies at war for talent

22 April 2014

Attracting and retaining the right employees is, and will continue to be, the major challenge for European mid-market companies. Businesses across Europe are bracing themselves for a long, hard-fought war for talent, as the EU bids to compete internationally, warns Christophe Letellier CEO, Mid-Market Division for Europe for business management software and services provider Sage, reports the hrdirector.com.

Sage’s annual Business Index survey showed that the competition  for talent is hotting up as economies recover, business confidence rises, and companies look to key hires to drive and sustain growth. However, the factors challenging business include a lack of skills and a belief that national education standards need improvement. More than a third of mid-market businesses (defined as those above 100 employees) in the survey said governments should be doing more to improve skills development and education to boost business confidence (39% across all markets).

Of the businesses surveyed across Europe, 14% said that recruitment and retention were the biggest challenge for them in the next year. It is a concern in particular for mid-market companies in Germany (20%), Poland (17%), and Austria (17%). Across all markets, the figure in the UK was 12%, suggesting that British firms are focusing on developing new business and expanding into new markets as the UK economy leads the charge in the global recovery.

A lack of a skilled workforce to recruit from was also a leading issue to doing business for many mid-market companies across Europe, with 12% across all markets cited this as the biggest challenge. Business leaders in Germany were the most concerned about recruitment with 29% citing the lack of a skilled workforce to recruit from as their biggest problem. However, in the UK this was lower down the list of challenges with just 8% saying this is an issue, indicating that although the skills issue remains a perennial bugbear to employers, UK businesses have access to comparatively highly skilled employees than those within mainland Europe.

Other problems cited by European businesses included too much bureaucracy and legislation to understand and apply (22%) and the respective governments’ handling of current economic challenges (12%). The vast majority of UK firms (78%) also told the survey that more was needed to be done by the UK Government to get banks lending to small businesses again.

Despite these challenges concerning the business world, the Business Index survey found that optimism among mid-market European businesses was at a three-year high. The survey showed that UK mid-market companies were positive about their own prospects, recording a score of 64.84 out of 100, slightly lower than the 65.82 global average.

European mid-market companies were markedly less optimistic about the prospects for their respective country’s economy (53.19) and about the global economy (52.41). These figures were 54.60, and 53.18 respectively in the UK, suggested a slightly more positive outlook than the rest of the world currently enjoys.

According to Mr Letellier, mid-market businesses are the unsung heroes of the European economy, and the bedrock of that success are the people. Businesses need to do everything they can to ensure they attract the right talent, so they can continue to succeed and grow during what remains a challenging business environment, despite the economic recovery.

The data indicates that companies are getting squeezed at a time of unprecedented competition for talent, and that differentiation between businesses is essential as potential candidates start to focus on what tools and processes an organisation can offer skilled staff members.