According to business advice firm BDO’s latest Rethinking the Economy survey of 500 mid-sized companies, staffing is the biggest concern amongst regional business leaders, with more than a quarter (28 per cent) citing recruitment as the most significant barrier to growth.
The survey showed that 52 per cent of Midlands businesses are struggling to fill open roles, with 28 per cent saying that they can’t find the right people with the appropriate skills.
In the next six months, 37 per cent of Midlands companies plan to upskill existing members of staff to enable them to do different roles going forward, with nearly a third (30 per cent) intending to hire experienced people in senior positions.
Despite concerns from business leaders (26 per cent) that customer confidence will also hamper growth, looking ahead nearly a third (32 per cent) expect more remote and flexible working will help ease the skills gap, as businesses will have access to a wider talent pool.
Tim Foster, partner at BDO in the Midlands, said: “The region has had to contend with staff and skills shortages for many years, particularly across traditional sectors, such as manufacturing and engineering. The coronavirus pandemic has undoubtedly accelerated the problem and crystalised the importance future talent will play in the region’s economic recovery.
“Despite the concerns over staffing and customer confidence, what is clear is that business leaders in the Midlands still have a firm focus on growth – both through investment in their people and business, with the majority of mid-sized companies (67%) stating that now is the right time to invest. However, this sense of optimism is tempered with nearly a third (32%) saying that it will take between one and three years to return to pre-Covid revenues.”
As restrictions lift, there are still challenges ahead for Midlands businesses. The Rethinking the Economy survey showed that the most immediate priorities for businesses in the next three months are managing the ongoing impact of COVID-19 restrictions (28 per cent), with 26 per cent of people also stating that growing revenues is also key.
Mr Foster added: “There are many competing factors that are continuing to add substantial pressure on regional businesses post-lockdown.
“Unsurprisingly, all businesses said they were concerned about the potential impact of inflation, with 16 per cent saying they would need to raise wages in line with a higher rate, while 24 per cent of respondents said that making job cuts as a result of increasing costs was still a real prospect. It’s clear that despite entering the final and ‘irreversible’ stage of the Government’s roadmap out of lockdown, the regional economy still faces considerable challenges over the coming months.”