What risks do small businesses face in 2018?

It’s fair to say that we’re operating in a hectic world and dealing with pressures from all angles. When you’re a small to medium sized enterprise (SME), it can be a struggle to keep up whilst retaining clients, winning new ones and simultaneously develop a competitive market proposition. Yet, all this is by the by if you’re unable to recruit and retain the right people; your employees are critical to survival and success and offering your workforce the right support framework and environment is integral to building a sustainable business.

This is the first in a series of articles looking to help small to medium sized businesses build resilience in an increasingly harsh economic environment.

So what issues are affecting your organisation’s ability to recruit and retain talented employees?

Ageing Workforce – supporting a diverse demographic

It’s well known that the UK has an ageing population; you only need to check the Office for National Statistics (ONS research) to get a sense of this. Couple this with the removal of the Default Retirement Age, and companies may well have an increasingly ageing workforce, something that will need to be catered for.

It has been forecast that by 2022, 14.5 million more jobs will be created, but only 7 million younger workers will enter the workforce – this represents a 7.5 million gap. The same research has found that a million older people who want to work are out of work.

In a time where employees are scarce and unfilled vacancies are high, this represents an opportunity for small businesses.

The experience that older workers bring can be a great boon, but older people are likely to have different needs compared to a younger workforce.

With the right Employer Value Proposition (EVP) in place, small businesses can be confident in their ability to recruit older workers. Simple cultural changes like flexible working can go a long way in improving a company’s attractiveness to a particular demographic.

New benefits are developed all the time, from healthcare apps to access to GP services, and it’s important that benefits are tailored to meet the specific needs of your staff demographics.

Having these facilities could be the difference to support the talent that comes with older workers.

Mental wellbeing in small companies

Three out every five employees (60%) have experienced mental health issues in the past year because of work, according to Business in the Community’s mental health at work report 2017. As one of the last taboos, many employers are wary about how to tackle this issue. Yet when it is so prevalent, chances are that you will have staff that will have mental ill health, and you are likely to need support in how to help them.

The correlation between mental health and productivity is being increasingly researched and poor mental health is associated with higher rates of absence and presenteeism. So if you’re not looking after the mental welfare of your employees, it could be hampering your business.

There are many resources available to help you. Mental Health First Aid training can help managers identify signs of mental ill-health and sign-post staff on how to find support.

Early intervention, fast-track access to counselling, and specialists that can identify the most appropriate support are all available.

The earlier that help is provided to someone experiencing mental health issues, the better the chances of their recovery. Of course, this is good for staff and your business but on top of that, when colleagues see how well you support other staff it can greatly enhance employee loyalty. This may also help staff feel that they can be open about their mental wellbeing.

Companies that have a mental health policy take an important step in building business resilience.

Financial resilience for employees in SMEs

Debt and financial worries are shown to be a key factor affecting productivity at work, with one in four people performing poorly at work due to money worries.

Employers have a unique financial relationship with every employee because they pay their salaries. Staff are also shown to trust their employer when it comes to financial guidance. Forward-thinking employers are capitalising on this and introducing financial support and financial education to their staff.

Support might include providing an employee assistance programme (EAP) with access to advice on debt, budgeting and money management.

Financial education might include guidance on managing household finances, how to source credit responsibly, help with understanding pension statements, making effective use of employee benefits.

You need to have confidence in the financial advisers that you put in front of your staff. Advisers with a good reputation, expertise in financial education and who understand the intricacies of your employee benefits will reflect well on your business and be a great support to your staff.

Alleviating money worries from staff contributes to good mental and physical wellbeing. A financially healthy workforce is a resilient workforce, and that builds a resilient business.

Talent attraction and retention strategies

SMEs often have to work harder at recruiting good people. Budgets can be tighter than for large corporates, so remuneration packages need to be good value: affordable for the employer and of value to the employee.

One of the most valued employee benefits for SMEs is Private Medical Insurance. Offering this to staff can be a great help at recruitment stage. It’s also a great way to build resilience for your business. Shorter waiting times and quicker access to treatment is likely to mean less absence.

Many insurance products provide extra added value above and beyond the financial. For instance, Group Income Protection is designed to provide an income to employees if illness or injury prevents them from working for a prolonged period. However, it can also be a great tool to prevent absence in the first place. Early intervention services are often available which aim to help reduce the likelihood of absence altogether, or reduce the length. This can be a fantastic insurance that benefits both the employer and the employee. Not all Group Income Protection products provide the same services, so it’s important to take advice on one that will offer the most appropriate support for your business.

We’re here to help

SMEs may think that the costs of providing such benefits are prohibitive, and just the domain of large corporates. Not so. There are employee benefits specifically designed for SMEs. These don’t just focus on value, although of course that is important, they are also designed to support the particular needs of SMEs.

As a resource specifically aimed at supporting SMEs we will continually add to this library and will be looking at each of these areas in more depth over the coming months.

Disclaimer: This article has been written in collaboration with Legal & General, one of Elect’s insurance providers. It is for information only and is not specific advice. It is based on our current understanding of the attributed research which may change in the future. Mercer is a sponsor of Business in the Community whose report has been used as a reference in this article.