Are Small Business Owners Having Issues with Hiring?
There are tons of people out on social media giving business advice. Some of it is good advice, but most of it isn’t good. In this new series watch CapForge’s owner react to different advice videos. He’s an expert in all things business and has 20+ years of experience under his belt. Some of the things he reacts to might even surprise you!
CapForge Founder and Owner Matt Remuzzi reacts to an NBC News article about the issues small businesses are running into when hiring new employees.
Video Transcript:
So there’s an article from NBC News, says small businesses are still hungry to hire but many workers eye better pay elsewhere. Employers with workforces in the tens and low hundreds are raising wages at a speedy clip but their bigger rivals may be able to offer fatter paychecks. This is true, but I don’t think it’s necessarily new. And big companies have always been able to offer more to their employees just because of their size. They can get better health plans, they can get better retirement plans, they can offer company cars and cellphone plans, and first-class travel for business trips, and things like that just because there’s more to go around. And the people signing off on those expenses and benefits the money isn’t coming directly out of their pay, right? They’re just managers in the business as well, even up to the CEO is a hired employee of the business. Whereas when you’re talking about small businesses, those benefits are basically coming directly at the cost of that business owner, right? By implementing benefits and retirement plans and health insurance and everything they’re basically cutting their own pay which is a harder thing for people to do. A harder decision to make and there may just not be enough to go around to do that anyway.
So small businesses have always been at somewhat of a disadvantage and being able to offer the highest salaries and the best perks for employees. But hopefully what they can offer as an alternative is maybe more flexible work, or a location that’s better for that employee, or more opportunities for advancement because it’s easier to stand out in a small business than a larger business, or an opportunity something that you just enjoy more, right? If you would rather work with animals you might rather work at a small vet clinic than to you know develop drugs for animals at Pfizer or something. So you know there’s a lot of reasons for people to choose employment at a smaller place, it’s usually not the pay. It may be some of the benefits but not the health or retirement benefits but some of the flexibility or other benefits.
So it is a challenge as a smaller business to sometimes attract the best people if someone is really just comparing pay package to pay package. And that’s probably more true now than some of the times in the past where the economy goes up and down, but right now I think it probably does favor larger businesses to have more opportunity. But that said, I think it’s still possible to hire great people as a small business, you just have to put a little more effort into it. You have to make your business a great place to work. You have to create a positive environment. You have to reward people and appreciate their efforts, and do the most you can to make it a great place for them to wanna work. And then hopefully you’ll still be able to attract and retain good people who aren’t as interested in maybe just total dollar amount of pay, but the overall experience, right? They’re spending 40 or more hours a week at that place, so if it sucks it’s gonna take a lot more pay to make up for sucking than you might have to do if you can just make it a really cool place to work and on almost the same pay rate. So if you think about it from that perspective I think it makes it seem less daunting of a task or that you feel like you only have to sort of accept second-rate people cause all the good people are gonna go work at big companies. Definitely not the case, but it does take a little effort to get it there.
