Finding and retaining employees with the right skills and level of experience is a challenging feat for a business of any size. For small businesses, in particular, competing with other organizations for the same pool of talent can feel like an uphill battle at times.
Research from MetLife’s Employee Benefit Trends Study (EBTS), with insights specifically into small business trends, shows that attracting and retaining talent are the top business concerns for small employers. However, these concerns arise in the face of a difficult backdrop; according to data from MetLife and U.S. Chamber of Commerce’s Small Business Index (SBI) 60% of small businesses report that it is challenging to keep up with employees’ salary expectations and demands. Moreover, almost half of employers looking for new talent find it hard to provide competitive pay and benefits. These are just a few of the talent obstacles that small businesses are working to overcome, in addition to navigating the day-to-day realities of business management.
In response to these hurdles, some small businesses are exploring new strategies to engage current and prospective employees; here are a few examples to consider for your own talent attraction and retention strategy this year:
Offering Flexible Work Arrangements
It’s widely recognized that flexible work hours allow employees to better balance their personal and professional lives. Data from the most recent SBI for Q4’23 shows that almost seven in 10 small businesses intend to offer more flexible working arrangements this year. For small business employees who often work hourly shifts, this is a trend that will likely soon become table stakes for small business employees. Particularly as only 25% of small businesses offer paid time off, according to the EBTS, increased flexibility is an alternative way to provide employees with time away from work.
Hiring From Overlooked Talent Groups
Research from the SBI shows that 71% of small businesses agree that employers should consider employing overlooked groups, such as veterans, military spouses, formerly incarcerated individuals, and legal immigrants, to help offset staffing shortages. While we are making strides to get back to pre-pandemic employment levels, the truth remains that there are approximately “9.5 million job openings in the U.S., but only 6.5 million unemployed workers.” Tapping into these unique cohorts can help small businesses tackle shortages and access a larger talent pool with different areas of expertise.
Broadening Offerings
To catch the eye of new talent, SBI data shows that 50% of small businesses intend to incorporate new methods, such as offering increased pay, providing paid sick leave, or including salary ranges in job descriptions. These methods are not overly surprising considering the five pillars of care in the workplace – which I talked about in my last article for Small Business Trends that you can read here – and the power the pillars have in improving employee experiences both on and off the clock. If we look at benefits specifically, which can be particularly helpful in bolstering loyalty, satisfaction, and happiness amongst employees, dental insurance (64%) and vision care insurance (61%) are of great interest, according to our EBTS findings. As workplace benefits play a pivotal role in the employee experience, providing comprehensive benefits and programs can have a significant impact on employee well-being.
Incorporating Hybrid and Remote Options
Almost half of small business employers plan to offer a remote or hybrid work environment in 2024, according to the SBI. Employers are finding that remote or hybrid models not only promote greater autonomy among current employees in the long term but can also help offset worker shortages. Particularly as SBI data shows that 53% of small businesses say there is a worker shortage in their area, offering remote positions can help businesses reach new employees whom they wouldn’t have been able to hire due to previous geographic constraints.
Turning to Seasonal Workers
For some small businesses, such as those in the retail sector or food industry, seasonal workers can provide valuable support during busy periods. Interestingly, of small businesses that intend to hire seasonal employees, 74% plan to leverage hiring incentives or bonuses, according to the SBI. While seasonal hiring might not be the right fit for your business, other short-term scenarios, such as contract employees or freelancers, might benefit your organization.
EBTS data shows that three in 10 small business employees plan to leave their employer in the next 12 months, demonstrating the importance of implementing new strategies to retain already hard-earned current employees, while also putting a focus on attracting those who are ready to make a change. Small business employers have an opportunity to make changes to their retention approach and recruitment tactics to position their businesses for long-term success.
What changes is your organization planning to make this year to cultivate a positive employee experience and compete with other organizations on talent satisfaction, engagement, and retention?
By Cynthia Smith
As Senior Vice President of Regional Business at MetLife, Cynthia Smith plays a leading role in helping small businesses find the right mix of benefits to help attract and retain top talent.
