How to find good employees for your small business

The numbers don’t lie: It’s harder than ever to find good employees for your small business. There were more than 7.5 million unfilled jobs in the United States at the start of 2019 while only 6.5 million people were actively looking for employment, according to the U.S. Department of Labor.

For a small business owner with limited resources, hiring employees can be difficult, time-consuming, and costly. Before you start the search for your next skilled employee, consider these factors that could make your business more appealing to job candidates.

Offer a competitive salary

We’re in a candidate’s market, which means job applicants are getting offers and can be choosy about what jobs they select. The most common reason why a candidate rejects a job offer is that the salary is too low.

One mistake that business owners make is that they set a salary based on their budget, not on the market. The market will depend on your geography, type of industry, and other factors, so it’s a good idea to do your research before establishing salaries for new hires. Services like Glassdoor can provide information on salaries for specific professions. If you want to hire talented workers, you need to offer competitive compensation.

Use a targeted recruitment process

Create a persona of your perfect employee and target your recruiting efforts to find that person. Most people looking for a new job aren’t going to use the local newspaper’s job listings, and online job postings can result in a glut of unqualified candidates for an open position. Here are some tips for finding the best people:

Use your network. Reaching out to people within your network is a proven way to find new talent and save time vetting potential candidates. Business is all about building relationships, and a recommendation can help remove uncertainty during your search. Vendors and business partners can also help provide referrals.

Offer incentives to current employees. Many companies offer a referral bonus to existing employees who recommend a new hire. If an employee recommends someone who ends up being hired, you can offer a cash bonus, gift card, or other reward.

Use social networks. LinkedIn is the primary professional online networking site, but another site might be specific to your industry. One benefit to LinkedIn is that you can see if you share connections with an applicant. It can also be helpful to evaluate an applicant’s online presence. However, make sure that what you see on social media doesn’t influence your decision if it’s something that puts the person into a protected class (gender, race, religion, age, disability, origin, or pregnancy). You can use social media to find employees by sharing your job description or using recruiting tools on LinkedIn or Facebook.

Make your business attractive to prospective hires

Benefits are important. Companies that offer medical and financial benefits, such as a 401k, are going to attract better employees. Even in a very small business, you might be able to offer benefits through a local chamber of commerce or other organization if it’s too expensive to get them privately.

You can also use intangibles as your selling point. Offering generous sick time and vacation days can actually increase productivity. Flexible hours or remote work options can be of huge value to some employees. Maybe you can’t compete with employers who offer expensive perks like gym memberships, but smaller things like discounts and coupon cards on a regular basis can help.

Protect your business

Once you’ve found that employee who’s the perfect fit, protect your new hire (and yourself) with workers’ compensation insurance. If this is your first hire, it’s crucial to know the laws for your state with respect to when workers’ comp is required. In addition to providing benefits for medical treatment to employees if they become injured on the job, workers’ comp also protects you against lengthy and costly litigation.