Research by iwoca, Europe’s largest small business lender, reveals that two in five small business owners are concerned that employees will choose not to return from furlough.
The future after furlough
With the scheme coming to a close at the end of the month and the latest figures suggesting that 1.6 million employees remain on furlough, 41% of small business owners are worried about whether their staff will return to work. Female business owners are particularly unsure, with almost half (48%) expressing concern compared to 38% of male owners.
The findings suggest that these concerns could have a significant impact on their business. One in six small business owners believe that at least half of their furloughed workers will choose not to return when the scheme finishes, including 9% who say that none of their furloughed workers will opt to come back. With over 520,000 small businesses still accessing the scheme, this suggests that almost 50,000 owners believe that their furloughed employees won’t come back.
These concerns coincide with recent analysis of Companies House data by iwoca which revealed a 32% increase in the number of new business registrations in H1 2021 compared to H1 2019, suggesting that some furloughed workers are looking for new job opportunities or even choosing to start their own business opportunities or even choosing to start their own business rather than return to their current employment.
Businesses optimistic about hiring
However, with vacancies on the rise the research finds that more than two-thirds (64%) of small businesses will be looking to hire in the next year. While male business owners are more confident that their staff will return to work, they are also more convinced than their female counterparts that they will be able to hire new staff in the next year (65% to 60%).
Seema Desai, Chief Operating Officer at iwoca: “The furlough scheme has been a lifeline for hundreds of thousands of jobs across the UK, but it’s concerning how many small business owners who still have people on furlough fear that their staff won’t return when the scheme ends.
“Managing staff turnover often requires significant time and effort, and it is likely that many small business owners will have to make this investment in the coming months in order to keep growing their businesses.”