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How SMEs are adapting their recruitment approach to counter cost-of-living pressures in 2024

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With challenges such as cost-of-living pressures sitting high on the agenda for businesses in 2024, the Skills for Life campaign’s ‘Skills Horizon 2024 Barometer’, has found that 64% of SMEs in England are deploying lower-cost recruitment tactics to continue investing in talent.

Employing a workforce who can contribute the required skills is key for employers, regardless of the wider landscape, and the reasons for the demand for staff with new skill sets varies from business to business. Many, for example, will be conscious of the continued need for a rapid digital development, in particular in light of both the opportunities to capitalise on the rise of AI, or the need to counter the challenges of it. This means that primary skills required from their workforce are shifting. Others will be mindful of the importance of having diversity amongst their teams and will look to improve on this by hiring new staff from new candidate pools.

Fortunately, there are many flexible options available for businesses looking to plug skills gaps in a cost-effective way that will help them reach their 2024 ambitions. Some of these involve trying new approaches, which means that being open to exploring new ways to meet business demands and strengthen workforces will be crucial.

Skills for Life research data suggests many SME employers are embracing new recruitment approaches, however, to counter the challenges the year could bring. In light of the cost pressures of running businesses, when looking at strategies for growth amidst these challenges, two-thirds of SMEs plan to invest in low-cost and long-term workforce recruitment tactics such as school-leaver employment schemes (e.g. apprenticeships) (53%) and T Level industry placements (60%). Apprenticeships allow employers to hire staff with character traits that will be an asset to the business, and then upskill them on the job, rather than looking to a limited pool of people with existing skillsets.

Additionally, seven in 10 SMEs are looking to take an introspective approach by investing in their current workforce – a 4% increase on last year – with 3 in 5 considering offering training and employment schemes for existing employees to help plug skills gaps they foresee in the year ahead.

Upskilling has real benefits to employee satisfaction, and in a competitive job market, this can be an economic way for businesses to be more attractive to potential recruits. Knowing they will be invested in, and that there are future personal growth opportunities is a big selling point to job applicants. It seems providing upskilling opportunities has become an important indicator of demonstrating the value you place on your workforce, and applicants will be aware of this.

Steve Young, Apprenticeship Supervisor at North York Moors National Park Authority, in Yorkshire plans to continue using technical education to build and strengthen the business this year. He said, “When it comes to recruitment, there aren’t enough people in the local area with the skills we need. To help meet our business demands, in 2024 we are going to continue with our apprenticeship programmes and upskill the wider workforce in leadership and project management skills. Having the flexibility to upskill people on the job means we can focus on hiring people with the right attitude for the business, and then provide training to develop more technical skills.”

Businesses considering hiring or upskilling employees can access a variety of training and employment schemes. These schemes can help develop existing employees and keep a steady pipeline of talent coming into the business. All the schemes have their own unique benefits so understanding the options available will be important for employers. The Skills for Life campaign aims to help SMEs understand the training and employment schemes available to them.

One option is hosting T Level students on industry placement, for 45 days. T Levels are beneficial to both parties – businesses benefit by nurturing skills they need for now and the future, whilst the students benefit from the technical experience they need to forge their chosen career path.
Apprenticeships are another option – available to individuals over the age of 16, and lasting for a minimum of 12 months. Apprentices don’t always have to be new recruits and may instead be existing employees, moulded to deliver the skills your business needs.
Alternatively, if your business wants to focus on upskilling staff in one particular area, then a Skills Bootcamp may be more appropriate. These are flexible training courses for those aged 19 and over to fast-track specialist skill development, for existing or new talent for your business. They take place over a shorter space of time but, like apprenticeships, still provide an opportunity for existing staff to master new skills.
Higher Technical Qualifications (HTQs)are level 4 and 5 qualifications (such as HNCs, HNDs and Foundation Degrees) that suit both new recruits and existing employees. Taught at further education colleges, universities, or by independent training providers HTQs can be studied flexibly full or part-time to suit learners and employers.
Multiply numeracy courses are free maths courses for those aged 19 and over. Multiply allows employers to build the skills of their current or future employees with low numeracy skills or confidence, helping reduce numeracy related mistakes at work, and boost productivity.

To find training and employment schemes for your business, as well as support on how to implement these, visit: https://find-employer-schemes.education.gov.uk/schemes/