The UK jobs market is in line for a welcome boost after it emerged that more than a third of Small and Medium Sized Enterprises (SMEs) intend to recruit new staff in 2014.
According to research by Clydesdale and Yorkshire Banks, 39% of SMEs intend to recruit new employees. The research found that on average, Britain’s 4.9m* SMEs expect to grow staff numbers by 3.1%. If this figure is applied to the total SME workforce of 14.4 m* this means that more than 446,000 new jobs could be created across the UK.
The recruitment intentions highlighted by the research were supported by significant investment plans. Nearly a quarter (24%) of SMEs questioned said they would spend additional money over and above existing budgets on new staff in the coming year.
The survey shows that small businesses (50-99 employees) are the most likely to grow staff numbers, with 69% of firms in this category saying they plan to create jobs. Medium-sized businesses (100-249 employees) were close behind with 65% of these firms saying they intend to recruit new staff.
Some sectors are set to benefit more than others from the anticipated jobs boom, with more than half of construction firms (59%) and manufacturing SMEs (53%) citing plans to create jobs. Recruitment intention was also significant within the food and drink sector with 43% of firms saying they are likely to hire new staff.
The research also revealed considerable regional variations. Job prospects are especially positive in London where 49% of SMEs intend to hire more staff. Recruitment is also set to be strong in the North East, where 47% of SMEs signalled plans to increase staff numbers, with Scotland (44%) following closely behind.
While the majority - 52% - of businesses surveyed have no immediate plans to recruit staff, just 3% said they would cut staff numbers, suggesting that the economic recovery continues to gain ground.
The survey suggested that SMEs also plan substantial investment in staff development with 44% of those who maintain a separate budget for training saying they expect the amount that they set aside to grow.
Overall, the research indicates that businesses are growing increasingly optimistic about the UK’s prospects with nearly three quarters (72%) of SMEs saying that they expect the economy will grow over the next year. Almost half – 49% - of firms expect their turnover to increase.
Paul Shephard, Director for Business and Private Banking with Clydesdale and Yorkshire Banks, said:
“SMEs are now planning for growth and their desire to increase recruitment and invest in their staff is a clear sign that business confidence is building. The creation of new jobs will help boost productivity and competitiveness as well as strengthening the improving economic recovery.
“As confidence continues to grow, we remain focused on supporting SMEs and investing in their growth ambitions.”