New data from small business lender iwoca suggests that 52% of SMEs are in favour of opening the UK’s doors to more workers from overseas with the expansion of work visas.
These figures come as SMEs have an excess of vacancies to fill, with job openings significantly increasing in recent years. Official figures show that small and medium-sized companies had a total of 459,000 vacancies in May 2023 – increasing by a quarter compared to the same period in 2019.
Micro businesses alone, companies with employees of 10 or fewer, have been hit hard, reporting 143,000 vacancies last month.
Nearly half (48%) of SME owners blame Brexit for the sharp decline in available staff in the UK. Between 2019 and 2022, the number of EU immigrants coming to the UK annually dropped by 54% to 151,000. These numbers have reached their lowest levels since before 2018 when EU migrants to the UK totalled 426,000 – nearly three times as much as 2022 levels.
With inflation remaining at 8.7% this month, the rising cost of doing business has meant increasing wages to persuade new staff to join has proved challenging. iwoca’s figures show that just 13% of SME owners increased their staff’s wages between summer 2022 and the end of the year, compared to 85% of businesses that didn’t increase their wage bill.
“Small and medium-sized businesses up and down the country are facing huge pressures right now,” said Christoph Rieche, CEO and co-founder at iwoca.
“Soaring vacancies, the inability to raise wages, mixed with staff shortages all mean one of the most important parts of the economy is battling against huge headwinds.
“SME owners believe that opening up the UK’s borders and expanding work visas are key for helping them to attract staff, and doing this will ease significant pressures on their businesses.”