Hiring in 2018? How to do it right.
Hiring is probably on your agenda for 2018. In fact, a recent survey revealed that 42 percent of small business owners report that they are hiring more employees this year. So you are not alone.
Hiring the best possible candidate is the goal of any employer, but even more important for small businesses who depend on a strong, stable workforce to survive. There is little margin for inefficiency and poor performance
But small companies can offer an advantage with their "second family" culture. The 2017 NYL Small Business Insurance Gap Survey reports that small business owners care deeply about their employees and are active in the community. The owners' top concerns are keeping valued employees (74 percent) and finding and hiring the right people (70 percent). In the event of the small business owner's death, an overwhelming 94 percent want employees to keep their jobs and continue the business.
Here are some best practices for improving your recruitment—and retention:
Building Your Bench Strength
If a high-caliber recruiting firm isn't in your budget, you can try such tactics as tapping into social media, scouring industry publications for talent and rewarding referrals to find the absolute best fit.
Who can double for you if you are unable to work, or when you're ready to retire? Owners reported that it would take three full-time employees to replace them. 1 That's why cross-training is essential. This is also the time to explore key-person insurance, which pays the business in the event of a death of the owner or other principal.
What Can You Offer Your Employees?
Frequent turnover can hit a small business especially hard. It can take more than a month to fill an empty job, leading to additional costs for overtime, new employee training and reduced productivity during the transition. That's why it's important to find people who are the right fit from the start and to develop a talent pipeline. You should define your business needs, assess what you can realistically offer, analyze the competition and understand what's attractive to people in your industry.
Gone are the days when people expect to work for one company for their entire career. Of all the workforce generations, Millennials (born between 1983 and 2000) are the most interested in professional development and will leave to pursue better opportunities. As a small business owner, you can be more nimble than a big company by offering unique benefits, like a mentorship/apprentice program—you provide training and a path to advancement, while the employee learns the job and the industry.
Develop a Strong Culture
Of course, some reasons people leave are out of the business owner's control. But there are other elements you can shape that will help attract—and keep—high-quality employees.
Unless you're working as a first responder, every day on the job shouldn't feel like a three-alarm fire. Workplace culture and safety are important for your employees, and frequent high levels of stress will quickly lead to burnout. Do a regular audit of how your company handles conflict, emergencies and crises. What can you improve and what can you expand that's working well?
When you give back to the community, you're not only helping people and causes that need it, but you are creating a more attractive workplace culture. There are also bonus reputational and marketing “halos" for your business when you're engaged in the community, so everyone wins.
The Small Business Insurance Gap survey showed that 77 percent of small business owners are already giving back to individuals and the community—for example, 31 percent have joined a booster organization or chamber of commerce, and 31 percent organize volunteer events for a local school or charity. 1
When considering your community commitments, find something that aligns closely with your business mission. Is it arts, environment, animals or people? Ultra-local, national or global? When you narrow your focus and efforts, you will make the biggest impact.
Benefits Are Key
A small business may not be able to match a big company's benefits, but they can often provide more flexibility, adding to that close-family feeling. Nearly four in 10 business owners have helped pay medical expenses for an employee, and about one in three loaned money to workers for a major purchase. 1 What can you share with your workforce? Products, discounts, time off and remote work arrangements are all enticing perks.
Insurance, too, can be a big driver of employment decisions. Companies can offer deferred compensation as a way to fund future benefits through corporate-owned life insurance upon an employee's retirement. Group benefits, such as life insurance (term and/or individual whole life plans) and short and long-term disability are compelling to candidates, especially those who are coming from a contract-worker or freelance background.
Studies show that when you expand your talent pool to include people from varying ages, experiences and backgrounds, you're more likely to see an increase in innovation and productivity. People from different backgrounds can provide a new portfolio of tools and perspectives to reach new customers and recruit from their communities.
Even industry diversity is valuable: Perhaps that candidate from the hospitality sector can help improve your customer service, and the one from Silicon Valley can usher in a new, more efficient digital age for your business.
The Next Generation
Two in three survey respondents report wanting to get their children involved in their business. 2 If family members offer the right mix of personalities, relationship dynamics and talent, they can help preserve a legacy and protect shared business interests for generations to come. The survey showed that 77 percent of small business owners (well beyond the percentage for the general population) believes the future is bright for their children. 2
Cultivating the right mix of staff requires a significant commitment of time and resources. Like any wise investment, getting the right person will pay off down the road as part of your overall business plan—and help ensure your company's future is a long-lasting one.
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