Top Concern For 58% of SMEs Facing Workforce Challenges

• Challenges in expertise acquisition, price administration, and ESG reporting emerge because the three high hurdles for SMEs in 2024.  

New analysis from the Association of Chartered Certified Accountants (ACCA) highlights the urgent challenges and strategic innovation alternatives for small and medium-sized enterprises (SMEs).  

The research, SMEs: Business challenges and strategic innovation alternatives,reveals three predominant challenges: escalating prices, workforce and expertise administration, and the evolving ESG (Environmental, Social and Governance) reporting agenda. 

Fazeela Gopalani, Head of ACCA Middle East, stated: “As we enter the new year, SMEs are grappling with a wide spectrum of issues. The inflation challenge has been a truly global phenomenon, as central banks raced to control inflation initiating some of the most restrictive monetary policies across the world seen in recent times.” 

“Our research also suggests that SMEs continue to struggle to both acquire and retain key talent, as well as continuing to face significant wage pressure and pay demands within their organisations. Upskilling is also a critical area of focus as technological change speeds up. By addressing these challenges head-on, SMEs can unlock new growth avenues and strengthen their market position,” Gopalani added. 

The report emphasises the necessity for tailor-made methods that may assist SMEs navigate the evolving enterprise panorama efficiently, together with embracing innovation, optimising useful resource administration, and staying forward of regulatory modifications. 

Key findings embrace: 

• Cost pressures and the economic system: SMEs face vital will increase in utility costs and provides, with 58% of companies highlighting increased prices as their high concern.  

• Workforce and expertise administration: The research reveals a notable rise in job vacancies and challenges in filling particular roles. Increased job vacancies for skilled staff had been reported by 31% of companies, and 14% had been unable to seek out appropriate candidates for clerical staff, technicians, and repair and gross sales staff.  

• SMEs and the ESG agenda: Nearly 50% of SMEs are actually required to supply ESG info, highlighting the rising significance of sustainable practices. However, the report identifies a spot within the capacity to generate and handle this knowledge, presenting each a problem and a chance for SMEs. 

“As risk proliferates, there is a wealth of new and emerging regulation impacting businesses, most obviously in the area of ESG. Regulation and reporting requirements will continue to evolve fast in this area, and SMEs need to be future ready to accommodate increasing demands,” says Gopalani. “In these testing times, SMEs must pivot towards innovative strategies to navigate the complexities of cost pressures, talent retention, and sustainable practices. Our research not only identifies the critical hurdles but also offers a roadmap for SMEs to emerge stronger and more agile.”  

The roadmap recommends the adoption of digital applied sciences, enabling SMEs to streamline operations, scale back prices, and improve productiveness. It additionally emphasises the significance of embracing sustainable practices, not solely as a regulatory compliance measure but in addition as a strategic transfer to draw new enterprise and prospects.  

It additionally encourages SMEs to develop and retain high expertise by way of steady studying and growth alternatives.