Small businesses prioritise employee well-being over product and technology growth
Recent research among small and medium-sized businesses has revealed that investment in employee welfare will outrank product and technology developments by 2025.
Skipton Business Finance conducted a study in which it asked over 1,000 business owners, key decision makers and business optimists about their business outlook and priorities for the next twelve months.
The top investment priority for business owners this year was employee well-being (27%), followed closely by product development (20%). Technology innovation (16%), and recruitment of top talent (12%).
The survey shows that 75% of respondents have a more optimistic outlook for the year 2025 compared to the previous year.
Matthew Shepherd, Chief commercial officer at Skipton Business Finance:
It’s encouraging that most business owners have a renewed optimism for 2025, despite the ongoing economic challenges. The survey results show the resilience of UK entrepreneurs and it is great to see employee wellbeing as a top priority.
“Happier, healthier co-workers in an employee-first atmosphere are key to maintaining staff numbers and can have a big impact on overall success and service levels for a business.
We’re finding that more and more of our clients are not only willing to put time into prioritising staff welfare, but also willing to invest money into initiatives such as flexible working solutions or mental health support.
Understanding Last Year’s Challenges
The survey results also revealed that businesses are facing persistent challenges, and their priorities are changing as they navigate through economic uncertainty.
Cash flow will be the biggest challenge facing businesses in 2024. 27% of respondents said that it was their main concern.
The challenges that businesses face include hiring and retaining employees (17%), business retention rates and increasing business rates (15%) and feeling personally accountable for the success of their business (14%).
What impact do government changes have on the results?
In 2025, economic uncertainty will still be the biggest concern for 45% business owners. This is followed by inflation (both at 15%) and rising living costs.
54 % of business owners said that they did not believe the UK’s exit from the European Union has benefited their business in the way intended.
The next step was to address skill shortages and gaps (10%). This was followed up by plans to upgrade UK ports and create supply chains (8%) as well as the promise to reform the education system, including apprenticeship opportunities (5%)
Matthew Shepherd said:
It’s encouraging to observe that SMEs are optimistic despite ongoing challenges, such as increasing wages, material costs and rent. Maintaining a positive attitude as a business person is important in today’s economy.
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