Small Businesses

Small businesses are a crucial economic engine in the U.S., with more than 33 million small firms employing 61.7 million Americans, according to the Small Business Administration. They account for nearly half of private sector employees. 

But a small business is a delicate balance of investment in the business versus a tight bottom line. Running a successful small venture requires good people, and good people have to be hired. That’s a harder endeavor for a smaller shop. 

“We hear about a lot of layoffs from many companies, so one would expect that hiring top talent would be easier,” says Steven Mostyn, chief human resources officer of Management.org. “However, many laid-off employees are taking a career gap and focusing on themselves and their families, making hiring a bit tricky recently.” 

Challenges of Hiring as a Small Business

Although small businesses run on a small headcount, managing that headcount is a challenge. For one thing, it takes resources to recruit, and small businesses lack the budget of a larger company. They also don’t enjoy the same name recognition. 

“You need top talent to expand, but it’s tough attracting them without the brand power or budgets of big companies,” says Finn Wheatley, a financial expert and risk analyst at The Small Business Blog. “It can feel like a Catch-22.” 

Additionally, small businesses have less money to work with, making competitive compensation a hurdle. And there’s less time to hire, since small teams are stretched across multiple responsibilities. 

“None of my customers have time or resources to quality check, reference and vet the workforce coming onto site,” says Lucy Clarke, founder and CEO of Fixed Construction, which helps construction companies hire vetted workers. 

Hiring Strategies That Work for Small Companies

Thankfully, small firms are also teeming with ingenuity and grit, so they’ve found a number of solutions to the hiring issue: 

Build a Strong Employer Brand

Business branding can attract workers and make sure you get talent that identifies with your priorities. That means giving your company a personality that brings in workers who agree with the direction you’re headed. 

“We’ve focused on building a strong brand that attracts potential employees,” says Eric Eng, founder and CEO of AdmissionSight, a college admissions counseling company. “We’ve highlighted our company culture and our dedication to our employees’ growth and development.”

Eng’s company has invested in promoting its brand on various platforms, with a focus on social media where many job seekers are active. “We’ve also partnered with local universities and attended job fairs to grow our presence and reach out to potential hires,” Eng says. 

Offer Creative Compensation and Benefits

In some cases, workers will choose a job with a less competitive salary if it comes with benefits that suit their lifestyle. Do you offer time off for volunteering, plus a great 401(k) match? Make sure prospective employees know it. 

“We highlighted flexible scheduling, remote options, professional development — perks that attract talent craving work-life balance and growth,” Wheatley says. “Where we couldn’t match salaries, we provided other enticing incentives.” 

Midwest Cards, a dealer of collectible trading cards, offers the full package: “This includes health, dental and vision insurances, HSA and PPO plans and year-end bonuses based on company performance,” says Jim Christy, owner and managing marketing director of the firm.  Also on the menu: a profit-sharing plan and cash balance pension plan. “These add significant value to our compensation package,” Christy says. 

Streamline the Hiring Process

By cutting back on unnecessary steps and automating what you can, you can make it easier for your already-stretched workforce to manage the hiring process. This could mean relying on digital tools to help with portions of the hiring process — or using digital tools for other tasks at your company to free up more time for hiring. 

You can also get ruthless about the resumes that make it to your desk. “To make our process more efficient, we’ve implemented a bold move: automatic rejection for applications without portfolios or signatures,” says Peter Howard, founder and managing director of Phd Design, a graphic design agency. “Automatic rejection if they are addressed to ‘The Manager’ or similar. Automatic rejection if it is 12-point Times New Roman on a white sheet. If they can’t be bothered, then why should we?”

Utilize Referrals

Some of your strongest assets are your current employees. Building an employee referral program can make hiring faster, lower costs to bring in new talent and help you find someone who’s a great fit. 

“Leveraging our existing network for referrals has proved invaluable,” says Jessica Moore, CEO of headwear company SilkyDurag. “People tend to know like-minded professionals.” 

It’s a tough time for businesses and women. The pandemic resulted in alarming numbers of women leaving the workforce, and highlighted hurdles in American work culture – from pay inequity to childcare issues – that make it tougher for women to stay at work.

Recruiting women to work for your small business can sometimes feel like a challenge, but there are several strategies available to smaller companies, even with fewer resources available. Here are some things to try:

Pay women what they’re worth

This may seem obvious, but equitable pay is a good place to start. In a recent Monster poll that asked women what benefits they value most in the workplace, 82% of them chose “fair and equal wages.”

“Women want to know that they are being paid fairly and equally to their male counterparts,” says Claire Jarrett, marketing expert and founder of Jarrett Digital. “Small businesses can implement regular pay audits and make salaries publicly available to create a culture of transparency and trust.”

This is especially important in an era of increasing pay transparency requirements. Several states have laws requiring salary disclosures in job advertisements, and others allow internal employees to request the salary range for their job title. Make sure you understand the legal requirements in your state (and in the states around you, which are competing for your talent).

Promote a career path

Sixty-three percent of women Monster polled said they value having a clear vision for the future of their career. “Many women leave their jobs because they feel like they’re not given the opportunity to grow,” says Henry Purchase, lead of organic growth at online menu maker Menuzen. “If you give women opportunities to grow their skills and learn new things, they’re more likely to stay with your business.”

This is true for interviewees — who may be looking for clues about where they’ll be in five years if they join your firm — and for existing employees, who may be struggling to move up the chain.

“Women who work in male-led offices often struggle to be seen and heard, says Jocelyn Bermudez, a business consultant specializing in team development. “This can make earning a promotion, climbing the ladder, or even getting publicly recognized more complicated than it needs to be, no matter how qualified they are. Lay a clear pathway toward promotions.”

Focus on women in the workplace

Nearly a third of women (31%) in Monster’s poll said they value having female mentors in the workplace, and 45% of women said they’d consider turning down a job offer if the company lacked female leadership or female employees.

“Demonstrate your commitment to the long-term success of your high-potential female employees by linking them with leaders who can assist them in preparing for the next step of their career development,” says Edward Mellet, director at career site Wikijob. “A role model or mentorship program can make a significant difference for women seeking job advancement.”

Employee Resource Groups (ERGs) for women can also help bridge the gap. “ERGs can provide a safe space for women to connect with other women in the workplace and provide support for personal and professional growth,” Jarrett says.

Read Monster’s advice on small businesses and ERGs.

Offer women-friendly benefits

A quarter of women in our poll said they value maternity leave and/or childcare benefits at work.

Competitive benefits that meet women’s needs can go a long way. That could mean paternity and maternity leave, childcare assistance or tuition reimbursement, among other things. If it’s too expensive to manage on your own, consider pairing up with a professional employer organization, or PEO, which can pool your needs with other companies and land lower-cost benefits for everyone.

“Setting up a competitive benefits package will show that you value the contributions of female employees and make them more likely to stay with your company for the long term,” says Alex Capozzolo, co-founder of real estate company SD House Guys in San Diego.

And don’t underestimate the impact of lower-cost perks for your employees, including having a pet-friendly office, casual dress code, wellness stipend, and even unlimited vacation, which makes employees feel trusted and valued.

Be flexible

Another perk you can tout: flexibility. Thirty-seven percent of women polled said they’d consider turning down a job offer if a company lacked adequate flexibility for working parents.

As a small business, you may have more leeway than a larger corporation to offer a nontraditional workday, including remote work options and flexible scheduling. There’s also the four-day work week, which is gaining steam since a large UK study showed that employees trying it felt less stressed and were more satisfied with their jobs.

“It is crucial that a company’s culture demonstrates that women will not be punished for choosing work-life balance options,” says Joe Troyer, CEO and head of growth for SEO firm Digital Triggers. “In addition, the advantages of emphasizing work-life balance are evident. Many employees who achieve a healthy work-life balance tend to be happier, more focused, and less susceptible to burnout.”

Employee resource groups, or ERGs, foster a sense of community and help with employee retention, research shows. But while 90% of Fortune 500 companies offer ERGs, these affinity groups may feel out of reach to a company with a smaller headcount. 

Luckily, ERGs aren’t an all-or-nothing game, and putting ERGs in place can help small businesses stay competitive and keep up with current trends. 

Here’s how to make it work for your organization.

Gauge interest

An ERG is only as strong as its members, so you’ll need to clarify whether your employees want ERGs and what type of groups they’d be interested in joining. Some common types of ERGs include groups for women, people with disabilities, sexual orientation minorities, working parents or a cultural or ethnic group, among other things.

“What would they want it to look like?” says Laura MacLeod, an HR expert and consultant with From The Inside Out Project, an employee-morale company. “Do they care about this stuff? Who would be interested? You can’t put something in place and then say, ‘Please come to this XYZ thing’ if nobody cares.” 

Focus on one essential need

ERGs can educate, advocate and create community, but it’s not necessary to do everything all at once. 

“It’s important to evaluate the company’s needs and set very specific goals,” says Anthony Martin, founder and CEO of insurance agency Choice Mutual. “Take the time to determine exactly how the ERG will fit into the company and why it’s needed. For example, do you want to focus on recruitment strategies and discover more creative solutions to reach a more diverse pool of candidates?”

Keep it small

There’s no need to press everyone at the company to participate, particularly as your ERG finds its legs and purpose. A few dedicated members can determine the motivation and goals of the group and figure out what they’ll need in order to achieve what they want. 

If people and budgets are an issue, consider joining forces with another organization. “A small business could partner with a local chapter of a national organization to provide resources and support for its ERG,” says Rahul Vij, CEO of SEO agency WebSpero Solutions. 

Harness technology

Particularly now, it’s possible to use tech tools like Slack or Microsoft Teams to organize and communicate. Slack channels for various ERG groups, for instance, gives team members some online space. 

“Team members can join the channel to push each other to reach their professional and personal goals,” says Dmytro Sokhach, founder of link building company Admix Global. 

Virtual tools are also the key to ERG success if workers aren’t all in the same office. “They are especially useful for small businesses with remote or geographically dispersed employees because they allow for regular communication and collaboration regardless of location,” says Adrienne Couch, human resources analyst with business site LLC.Services. 

Keep it simple

ERGs can do all kinds of useful things — bring in speakers, organize workshops, etc. But that can feel overwhelming if you’re also trying to juggle all the responsibilities of your small business.

“In my opinion, group lunches are one of the simplest and most common team-building exercises,” says Tia Campbell, director of marketing at Practice Reasoning Tests. “Since dining is a routine part of the day, it is simpler for many employees who cannot spare extra time to meet off the clock. Members of the group can cook together, dine out or order in.” 

Engage senior leadership

Company management buy-in is crucial to the success of your ERGs, since they’ll need to provide budget, time and help shepherding any changes submitted by an ERG into place. 

“Another reason senior leadership is so critical to the success of an ERG is because often, the employees serving on an  ERG are doing so voluntarily while they must still complete their job requirements,” says Melanie Miller, an inclusion strategist in Atlanta. “Senior leader support is helpful when mid-level and front line leaders won’t let their employees leave for ERG meetings and events.” 

Keep the endgame in mind

While creating an ERG as a small firm may not be the easiest or smoothest task — and you may wonder if it’s worth your time — keep in mind that ERGs benefit employees and their companies in lots of ways.

“Our employees reported feeling a stronger sense of belonging and motivation to

contribute to the success of our business,” says Sam Underwood, an ecommerce SEO consultant. “In fact, we saw a 20% increase in employee satisfaction just six months after launching the ERG program. By investing in our employees’ well-being, we are also investing in the long-term success of our company.”