How small businesses can retain staff in a competitive job market

Small businesses are struggling to retain staff and compete against large companies with deep pockets.

Onboarding new employee warm welcome to new office introduce new hire to colleagues orientation training on first day concept businessman manager handshake welcome and introduce new staff to team
(Image credit: Getty Images)

Small businesses have a people problem – how to retain staff? In a highly competitive job market, they are losing staff to large companies whose resources enable them to pay higher salaries. Almost nine in ten British small firms taking part in one recent survey said they were struggling to match the pay deals on offer from larger rivals. 

In that case, they need to find other strategies for boosting staff retention. The good news is that remuneration is not the only thing that counts when it comes to keeping staff – many people are more interested in other factors. Focus on these to give yourself the best chance of holding on to key members of your team. 

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David Prosser
Business Columnist

David Prosser is a regular MoneyWeek columnist, writing on small business and entrepreneurship, as well as pensions and other forms of tax-efficient savings and investments. David has been a financial journalist for almost 30 years, specialising initially in personal finance, and then in broader business coverage. He has worked for national newspaper groups including The Financial Times, The Guardian and Observer, Express Newspapers and, most recently, The Independent, where he served for more than three years as business editor.