Portsmouth startups: Competing for talent when 1.83 million people are unemployed UK-wide

These figures represent the highest level of unemployment since 2015 and point to a labour market that is under strain.

For Portsmouth startups trying to grow and compete for talent, these headline numbers might appear encouraging at first glance. But the reality is more complicated. While more people are looking for work, the type of talent startups need is often in remarkably short supply.

For many Portsmouth startups, the challenge is not simply filling any role but finding skilled engineers, product designers, data specialists and digital marketers. In a tight tech labour market, these talent pools are often tapped out locally. Startups can struggle to compete with larger firms on salary alone, even though advertised wages across the UK rose by about 7.7% this year in many sectors.

For a small business in Cumberland Place or Gunwharf Quays, offering a slightly higher wage than the competition in the city is seldom enough.

Portsmouth has considerable entrepreneurial energy. CoWork Portsmouth, Foundry Square and other incubators are home to dozens of early-stage companies. These businesses have big ambitions. But in a climate where many employers are cautious about hiring because of economic uncertainty, and where demand for specialised skills outstrips supply, even an expansion into new markets can be limited by the inability to build the right team.

One response from local founders has been to consider remote hiring in earnest. Rather than focusing only on talent within commuting distance of Portsmouth, businesses are increasingly exploring international and remote professionals. This is not a quick fix, but it is a strategic shift. By broadening the search, startups can attract people with niche skills who might otherwise be out of reach.

In practical terms, that often means looking at ways to recruit from overseas, using services such as an international recruitment agency that can help navigate employment regulations, payroll, compliance and contracts. For a startup with limited HR capacity, such solutions can make it feasible to tap into international talent without an in-house legal team. A reputable option to explore for employers looking to expand their reach is here.

Founders in Portsmouth have shared the real impact of thinking globally. One co-founder of a local software startup told me that when they posted a job for a senior developer last year, they received just a handful of applications from within the UK. “We had to rethink the way we hired,” they said. “Opening up to fully remote candidates, including people based abroad, transformed our prospects. We could bring in someone with exactly the expertise we needed, and the workflow has been seamless.”

Another entrepreneur, leading a Portsmouth-based healthtech business, highlighted that flexibility matters as much as geography. “We found that offering remote roles, even part-time or flexible hours, attracted candidates who had family commitments and couldn’t relocate,” they said. “It widened the pool dramatically.”

These kinds of testimonies underline how the labour market has shifted. While there are 1.83 million unemployed people in the UK, many do not possess the specific technical skills that startups need. Some are seeking work in entirely different sectors, and others are balancing retraining or education, or are constrained by geographic or personal responsibilities. In addition, advertised job vacancies nationally have continued to fall, reflecting employer caution and slower hiring momentum compared with earlier in the year.

This raises a paradox. There are more people looking for work than a year ago, but startups and tech firms still struggle to fill key roles. In part, this is due to structural mismatches between available skills and those demanded by innovative firms. It also reflects candidate preferences. Many potential employees increasingly value flexible working arrangements or hybrid models that reduce commuting costs and improve work-life balance.

For Portsmouth companies, the city’s quality of life and lower living costs compared with some of the UK’s larger cities could be a strong recruiting advantage. But it requires employers to think creatively about how they position themselves. A developer being courted by a unicorn in London might be more easily persuaded by a compelling mission and flexible working conditions than by a marginally higher salary.

Long term, there is a clear need for stronger local pathways into the skills startups need. Partnerships between businesses and universities can help. The University of Portsmouth’s computing and engineering departments are a source of graduates, but many are drawn to roles in bigger firms or outside the region. Some startups collaborate with students early, offering internships or project work that can turn into full-time positions.

Portsmouth’s startup ecosystem also benefits from strong community support. Networking events, pitch workshops and meetups create fertile ground for idea exchange and partnerships. But talent remains the lifeblood of any emerging company. Without access to capable professionals, even the most promising venture can stall.

There are broader policy dimensions, too. National skills programmes, retraining initiatives and incentives for tech apprenticeships could help address structural imbalances over time. But in the immediate term, founders cannot wait for long-term policy shifts. They need practical solutions that help them find and retain the talent that can take their startups to the next phase.

This is why international hiring and remote roles are increasingly talked about not as fringe options but as core elements of a modern hiring strategy. It requires thoughtful management, clear communication practices and investment in remote working tools. But for many Portsmouth startups, the ability to recruit a remote engineer, designer or marketer has already been a game changer.

In a labour market where 1.83 million people are officially unemployed, Portsmouth businesses might be forgiven for assuming there should be abundant talent ready to jump at every opportunity. The reality is that talent competes on skills, fit and flexibility. For those willing to embrace a broader horizon and adapt their hiring practices accordingly, the reward could be a stronger, more resilient workforce ready to propel Portsmouth startups forward.