The right staff

By NATASHA MUKTARSINGH
Updated:

 

COMPANIES are optimistic about their prospects for the coming year, despite the poor conditions for growth. But one problem dominates their concerns - finding and keeping skilled staff.

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The latest quarterly report from business adviser Tenon, to be published on Wednesday, shows that of 1,000 directors of small and medium companies, nearly a fifth are very positive about their prospects and 60% are quite positive.

Aside from an uncertain economic climate, most firms see the recruitment and retention of staff as the greatest barrier to meeting their business objectives.

The problem is seen as more damaging than coping with European employment laws, another concern. Businesses appear to have more trouble with growth issues than day-to-day ones, such as managing cashflow.

Alan Newton, chairman of Tenon, says: 'There is a lack of consultation between the education sector and employers. This means recruits often don't have the basic skills that employers need. People might have some technical ability, but they will lack other skills that make employees attractive, such as decision making ability or people skills.'

Newton believes that, along with regulatory burdens, a lack of good recruits is stifling the growth of smaller firms. Vicky Young agrees. As one of Britain's few manufacturers currently recruiting, a lack of skilled staff is holding back her business.

Vicky, company secretary of Posithread in Washington, Tyne and Wear, says: 'We make tools for engineers and have no direct competitors. It's incredibly difficult to find people with the right skills so we have to train them, which is expensive.'

The business, set up by her husband Doug, 56, in 1986, employs 30 staff and turns over about £1.5m. 'We used to take people from training centres, schools and colleges, but the recruits coming forward now are just not ready for work,' says Vicky, 54. 'They don't know what to expect or what is expected of them. This is frustrating as we often pay for their training at college, only to find that they leave after two months in the job. The Government should be helping us to foot the bill.'

Sally Anderson set up Trinity Executives, a sales outsourcing business in 1989. The company, based in Windsor, Berkshire, now turns over £6.5 million and employs 500 people, most on contract. 'Recruiting staff has become difficult in the past three years,' says Sally. 'We have advertised in Jobcentres and not had a single response, and no one seems to train people in basic sales skills.'

She says further education institutions and Jobcentres should focus on skills such as basic numeracy and computer literacy. 'The Government is putting money into education and Jobcentres, but employers should be able to tell those in further education what they need,' she says.

Government figures show that more than a third of firms with literacy and numeracy gaps have lost business as a result, and an average company with 50 staff or more could lose £165,000 a year through the lack of basic skills. Bryan Sanderson, chairman of the Government's Learning and Skills Council, says: 'Seven million adults lack basic skills, which is severely affecting the performance of small firms.'

The LSC has set up a series of employer training pilot schemes, designed to help small and medium firms cover the cost of training staff. Sanderson says: 'Small firms are critical to the economy's success. It is vital that their employees have the right skills to help drive business forward and boost productivity.'

• For more details on training pilot schemes, visit www.lsc.gov.uk

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