The mental health of small business owners and employees is in the spotlight thanks to a prolonged period of acutely challenging market conditions. Safeguarding wellbeing requires investment, but how can under-pressure firms manage the costs?

How market conditions are affecting staff health

It comes as little surprise to learn many owners and employees in the small business sector are reporting poor mental health. The last few years have brought unprecedented headwinds in the form of the impact of Brexit, Covid-19 and the war in Ukraine, with political instability only adding to the problem.

According to new research from Towergate, over two thirds of small business owners that were questioned for their survey revealed struggles with mental health, at least occasionally. Almost a third said that they are dealing with poor mental health frequently.

A Simply Business survey paints a similar picture. According to the study, which involved 600 small business owners, 20% reported battling depression as a result of the cost of living crisis, with over 80% feeling worried about the how the current situation will affect their business.

Why investment is a difficult balancing act for small firms

The relief that an upturn in market conditions would provide is clear, but with such development seemingly set to take a while at best, it is important that the right staff wellbeing strategies are put in place.

This kind of assistance is becoming more commonplace – for example, Lloyds Bank has launched a new service that offers over 1,000 small business owners a series of free therapeutic sessions in partnership with Mental Health UK – but the amount of free help is limited, which means that businesses have to invest. At the same time, firms have to strike the balance between safeguarding wellbeing and ensuring the productivity necessary for survival and growth.

Investing in staff wellbeing and how alternative finance can help

At a time when the pressure on cashflow is unrelenting, it is understandable that small firms are struggling to find the capacity to invest, both time and money, in mental health strategies. But given the importance of owners and key staff, and the impact of losing them would have, it is vital that there is investment in wellbeing planning. This is where alternative finance can help.

In the wake of prolonged caution from traditional lenders, which is an issue that has returned during the pandemic and amid challenging post-COVID-19 market conditions, services such as invoice finance, asset finance and peer-to-peer lending are proving a vital source of capital for small businesses.

These facilities, which offer a more easily accessible and personalised approach to lending, are helping small businesses survive and target recovery, stability and growth. Notably, alternative lending played a prominent role in the government’s headline emergency support schemes in 2022, including the Recovery Loan Scheme.

This profile has helped cement the reputation of alternative finance in the business sector, with a recent study showing that more than 50% of small businesses are looking to use finance to achieve growth in 2023.

Staff wellbeing planning and small firm finance options

There is a clear link between the market conditions of recent years and the increased attention being paid to small business owner and employee mental health. As such, at a time when investment is critical but far from easy, it is vital that firms are aware of all the funding options available to them, including the services of alternative lenders, as they focus on balancing the need to protect cashflow and productivity with safeguarding staff wellbeing.

To find out more about A&T Business Associates services, contact Steve Bowles on 01903 602211 or steve.bowles@atbusinessassociates.co.uk.