Zero-hours contracts make SMEs in South West ‘feel guilty’

A third of small business owners in the South West say zero-hours contracts are deeply unfair on employees – however 38 per cent use them on their own staff.

Research into the attitudes of SME owners across the country focusing on how they hire, pay and view their staff revealed that zero-hours contracts are seen as a necessary part of running a business in what are still uncertain trading conditions for UK businesses.

And, while 45 per cent of those surveyed, in the South West, for the Viking Small Business Barometer favour zero-hours contracts because it allows flexibility in their business, 30 per cent think they are unfair as staff can’t rely on a regular salary. Of the small business owners polled 38 per cent used zero-hours contracts but felt guilty for doing so.

Sean Bailey, of small business supplies firm Viking, said: “This instalment of the barometer reveals the dilemma some small business owners find themselves in – their conscience seems to be split between understanding the impact that zero-hours contracts have on employees and needing to do what’s right for their business – keeping costs down to a minimum until the longer term economic picture becomes clearer.”

Other findings from the research revealed SME owners, in the South West, believe experience is more important than education – 26 per cent said they don’t value higher education qualifications within the recruitment process, with the respondents seeing no valuable difference between candidates having A-levels Vs. a degree. This is despite 42 per cent of them having a degree themselves.

In terms of outlook for the small business owners in the South West, 87 per cent said they are not worried at all about the economic future of their business with 57 per cent anticipating growth in 2014.

Worryingly however, when asked about retirement and succession planning, of the SME owners surveyed in the South West, a quarter (28 per cent) had no exit strategy or plan to hand over the reins of their business.

Nationally, it was revealed that female SME owners value work ethic over experience or education in the people they hire (38 per cent). This belief when hiring differs to their male counterparts who value experience over work ethic (45 per cent).

The Viking Small Business Barometer, is a quarterly tracker survey, which speaks to the same 1000 small business owners and Managing Directors across 15 sectors in the UK every quarter, in order to understand the thoughts and outlook of the country’s small businesses, which employ 14.1 million in this country and are seen as the key to economic recovery.

The Q4 barometer for 2012 revealed that SMEs across the UK fear their concerns for help with keeping afloat have fallen on deaf ears, as two in five (40 per cent) companies believe that recent changes to Government policies will have no positive effect on their business – leaving SMEs to go it alone. One in ten respondents believed they would have to close by the end of the year.