The small businesses industry is responsible for a significant contribution to economic and job growth. Small business owners also have a unique set of problems regarding finding and retaining the talent they need, mainly because they often compete with bigger companies and shifting unemployment rates.
It takes substantial investment and effort to select and train the right employee, but for some small companies, they seem to be putting the interview process on hold. We surveyed small business owners across the country to get an inside look into the latest hiring trends and the challenges that come with it.
About 71% of the businesses we surveyed stated that they aren’t planning to hire new employees within the next six months, which could reflect the 72% who claimed that they are not understaffed. However, we wanted to dig deeper into the reasoning behind these statistics. Here is a quick rundown of the most interesting statistics from our report.
Are you searching for qualified candidates?
If you are a small business owner, you most likely have been through the ropes of the hiring process. 52% of small businesses claim that it is difficult to hire employees that are qualified for positions. Interesting enough, a third of those use free job boards such as indeed, glassdoor and CareerBuilder. While these are popular sites for finding employees, small businesses might be better served to invest in paid search platforms to discover qualified candidates that meet expectations and requirements. Platforms like ZipRecruiter and JazzHR help to filter through resumes and screening questions to direct top talent that will suit your needs.
Seeking long-term loyalty?
We found that 80% of small business owners have not had any employees quit within the last six months. We think this is indicative that employers are providing benefits and pay that are keeping employees satisfied, happy and loyal. For those who did have employees quit in the last six months (36%) one of the top reasons they did so was to seek better pay. According to the questionnaire, almost 82% of surveyors said that employees hadn’t asked for a raise in the last six months. So why are employees leaving their company before asking for a pay increase? There can be many factors for this and perhaps those who work for small companies might worry the company can’t afford to give a raise or feel they deserve a higher pay but the company is unwilling to compensate. It’s hard to determine all the possibilities, but having transparency with your employees can help them feel comfortable in discussing pay and assessing whether or not they see a career for themselves.
Are you offering pay that is attractive to applicants?
Competitive compensation is a significant factor when attracting applicants and retaining them long term. However, almost, 73% of the small businesses do NOT offer higher wages to attract those qualified applicants. If you are planning to hire but aren’t offering competitive wages, then it could be time to adjust the company spending so higher salaries can be paid out. If your a business is making plans to onboard new employees the hiring process but unsure if they can afford to you don’t have the cash flow to offer competitive salaries, don’t fret. There are ways to get around the slump and acquire employees that will contribute to your path of profitability. Bringing in talented employees is an investment that can take your business to the next level when you are ready.
We advocate every day to help small businesses get to the next level of growth. Many times, that growth includes expanding employee force to continue and scale the business. One of the top 5 reasons clients have used our services in 2018 so far is for buying power and payroll. We understand there isn’t much financial freedom in the first few years of owning a small business and you’re often operating with a skeleton crew to do it all. As your business starts to grow, make sure you’re building a robust workforce around that growth. Scaling your business at the appropriate stages for long-term and sustainable growth is critical.
About Reliant Funding
We work with many financial partners to create a variety of customizable financing options. Many of our clients use us as a renewable source of working capital as they expand their businesses in phases. Based on the needs and finances of the company, we will work together to customize a funding package. If you have questions about our programs, we are always here to help.
As a leading small business funding company, understanding which challenges affect small business owners the most helps us to serve them better. Look out for our upcoming Fall 2018 Reliant Funding Small Business Report for more insights on everything small business.