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UK SMEs fuelling jobs growth, say BCC

The UK’s small and medium-sized enterprises (SMEs) are taking on more staff and increasing levels of pay for their workforce, according to the latest workforce survey by the British Chambers of Commerce (BCC).
A new report, titled ‘Contracts, Pay and Working Conditions’, is based on a survey of almost 3,000 businesses located across the UK and shows that small business owners are more likely to have increased wages above inflation, while a greater proportion of larger firms have kept wages more closely aligned with inflation.
The statistics show that a third (33 per cent) of micro businesses increased their pay above inflation last year, while 38 per cent of small businesses also opted for above-inflationary wage increases.
More than half (57 per cent) of firms surveyed pay all of their employees at least the Living Wage. Employers working within the catering and accommodation sectors were least likely to pay the Living Wage to all staff members.
Arguably the biggest obstacle to jobs growth for UK SMEs is employment regulation. Almost half (48 per cent) of respondents said the new statutory right for employees to request flexible working will harm their business, while only 17 per cent believe it will have a positive effect.
John Longworth, director general of the BCC, said: “These results show that businesses remain optimistic about both growth and pay prospects for their staff, despite the slowdown in the economic recovery that has been seen over recent months.
“However, it is clear that businesses are concerned that additional employment regulation will affect their bottom line and hamper future jobs growth.
“The majority of our members already offer flexible working, so legislating in this area is unnecessary and will likely push up business costs.
“At the same time, businesses must play their part. If they want to retain key staff as they start families then they must invest in childcare provision, which is currently inadequately supplied.”

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