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SMEs offering more cash to the right contract workers

Skilled and experienced contract workers are so in demand right now that an increasing number of small firms are offering them a premium for their services.

At least, that’s what the Federation of Small Businesses has found in a recent research study. How did the FSE discover that firms are offering more money to their contract workers and freelancers Well, it turns out that there are fewer staff members earning the National Minimum Wage than there were last year.

The actual figures show a definite improvement, if you’re interested; last year it was 27 per cent of SME staff members. This year it’s 23 per cent – a five percentage point drop that experts say is caused not by lower wage earners being made redundant but given pay raises – in fact, nearly one out of every two SMEs are now paying their employees and umbrella company contractors at least the Living Wage.

So why are rates going up? Well it all has to do with the retention of skilled and experienced workers, both freelancers and permanent employees alike. There’s a massive skills shortage going on if you haven’t noticed, and for what it’s worth it’s slowly but surely getting harder to source quality staff from the permanent workforce – which means that SMEs have a vested interest in finding and keeping staff members in order to remain productive. What’s the best as easiest way to do that? Pay your people, and pay them handsomely, of course!

Cynics say that eventually these firms will run out of cash, or prospective contract workers – or even both, in some cases. Of course that’s rubbish if you ask me – a successful SME will make shedloads of money, and re-investing that in their workforce will simply build on that success on a massive scale. Now there may be some truth to the idea of the skills shortage growing so chronic that the impact to the entire employment market could be crippling, but blokes smarter than both me and you put together are working on the problem right now; I say we just trust that there will be a solution found quickly and that it will be put into place in time to save our collective arses!

In the meantime, enjoy your pay raise. Maybe you should put a bit of it aside for a rainy day – you know, just in case. You never know, right?

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