By Max Clarke

As unemployment edges higher, research indicates that micro businesses are prepared to hire more staff but are being deterred from doing so by a widespread skills shortage amongst applicants.

Of the 2,000 business owners surveyed by the British Chambers of Commerce, some 55% indicated they were willing to boost headcount, but around half of these were finding it hard to find the right people for the job.

Unclear or onerous changes to employment legislation, as well as ‘ fairly or extremely burdensome’ dismissal rules were also seen as barriers to hiring.

Micro businesses, referring to enterprises of 10 and fewer staff, are vital to the UK economy, comprising some 20% of private sector employment whilst turning over 20% of private sector turnover.

“Micro firms make up an important part of our economy, and the fact that over half want to increase staff numbers is good news,” commented Dr. Adam Marshall, Director of Policy at the British Chambers of Commerce. “However, for those wanting to take on more staff, finding the right person for the job can prove difficult. And for too many firms, burdensome employment legislation deters them from taking on staff in the first place.”

Many businesses are frustrated by being unable to find the right skills in the local labour market. When asked how confident they would be that a school-leaver with A-levels or the equivalent would have the necessary skills for their business, almost half said they would be fairly or very nervous; with only 22% saying there were very or fairly confident. When asked the same question with regard to graduates, only a third of micro firms was very or fairly confident that university leavers would have the right skills for the job.

“Despite high levels of unemployment,” continued Marshall, “many micro firms are frustrated by the quality of applicants for vacant roles. There is a real mismatch between business needs and local skills supply, with many businesses unable to find school leavers or even graduates with the right mix of skills.

“At a time when we need to fight hard for every new private sector job, Britain needs a skills system that delivers what businesses require. A courageous government must recognise this and put more control in the hands of employers when it comes to training the nation.”


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