Daily NewsView All News
New research from specialist recruitment consultants Robert Half has found that SMEs are less equipped than larger businesses to take advantage of an upturn in the economy, as they have taken a more reactive stance to business challenges.
The report is based on a survey of 200 senior UK finance leaders in private companies, publicly listed organisations and the public sector. The research shows that 77% of SMEs are too busy responding to the economic downturn to adequately prepare a way out of it.
Conversely, 48% of large businesses have already started developing strategies for growing the business once conditions improve. Analysis has shown that the SME executives surveyed said they have adopted various coping strategies in response to economic conditions; chief among them are reducing headcount and overall employee costs. A number of larger businesses, on the other hand, are managing the changing economic climate by reviewing capital management strategies and developing new ways of raising capital.
Not surprisingly, the most common strategy for coping with the recession is implementing a cost reduction programme, cited by almost two thirds of respondents from companies of all sizes (62%), followed by salary reductions or freezes (58%). Just over half of survey respondents conceded that staff redundancies had carried their business through the recession (54%).
Phil Sheridan, Managing Director of Robert Half UK, comments "an upturn in the economy will present a wide range of opportunities for businesses. Companies of all sizes will need to move beyond adopting coping strategies for the recession and instead invest time developing plans for the eventual recovery and a return to revenue growth and expansion."
Among businesses of all sizes, 39% of respondents revealed that retaining key staff will be their primary concern when the economy recovers, followed by managing internal expectations (36%) and managing growth (30%).
As we move out of a recession, 56% of those respondents who said they were likely to recruit staff expect that accountants will be the highest hiring priority, followed by specialists in financial analysis and reporting (53%) and audit and compliance (44%).
Phil Sheridan added, "hiring demand will return in force as the recovery takes hold. Companies must therefore strike a balance between caution and action as they rebuild their teams or they risk losing top talent to competing offers."
Among the initiatives planned by businesses as they rebound from the recession are service line expansion and product development (54%) followed by business process improvement (49%) and systems update/implementation (47%).