Staff costs will have greatest impact on business

09/05/07 09:31

Businesses in the UK stood out in a recent global survey by predicting that staffing costs will have the greatest impact over the next 12 months.

The survey, conducted by business advisers at Grant Thornton, found that some 41% of British businesses thought that staffing would cause the greatest cost pressure over the next year.

However, the rest of the world cited raw material costs as having the biggest impact, with 44% of businesses worldwide and 47% of EU businesses saying it would have a major effect on their company.

In contrast to the rest of the world, the Grant Thornton International Business Report found that just 31% of UK businesses felt that raw material costs would have the most significant effect on their bottom line.

Commenting on the findings, Alysoun Stewart, head of Grant Thornton’s Strategic Services Group, said: “We know from our own clients and from other research that the skills shortage we are currently facing is the biggest constraint to growth, causing upward pressure on labour costs to ensure the business can attract the best people.

“When you compound this with the constant above-inflation increases in the National Minimum Wage over the past seven years, it is not a surprise UK businesses are saying that staff costs will have the biggest impact on their business over the next 12 months.”

British businesses rated energy costs as the second largest perceived cost pressure.