The sluggish economic environment is helping small and medium-sized enterprises (SMEs) to recruit more talented staff and retain skilled workers, a Hong Kong Productivity Council (HKPC) survey shows. The poll, which interviewed 422 SMEs in the manufacturing and service sectors last month, found the companies were pessimistic about the business outlook in the SAR in the coming six months. SMEs had been able to resolve their brain-drain problem which previously saw experienced employees switching to larger companies, according to HKPC SME Centre business enhancement services division general manager Vincent Li Kai-lun. As for the general economic outlook, 26 per cent of the respondents rated the outlook would turn 'poor', the poll found. Only 15 per cent described it as 'fair', according to the poll. The balance of 59 per cent remained neutral. The financial turmoil also exacerbated the difficulties of the SMEs in terms of bank borrowings, Mr Li said. More than 60 per cent rated the financial and investment status of their companies as 'poor'. To alleviate the financial difficulties encountered by SMEs, the Government has set up a $2.5 billion loan package in partnership with financial institutions in the SAR. By yesterday, Industry Department figures showed 39 financial institutions - including Hongkong Bank, Hang Seng Bank and Citibank - had joined the programme. The HKPC SME Centre is to issue a booklet to advise SMEs on how to approach financial institutions. 'The booklet will give hints on how to disclose their financial position and the typical approval process,' Mr Li said. 'If they need assistance, our consultant will help them to write the proposals.'