Attracting the Right Employee
General Business News
Attracting the Right Employee
Employers are finding it difficult to attract and retain qualified employees these days. This shortage probably has several causes, but whatever the reason, many of us are facing a shrinking pool of qualified job applicants. As business owners and managers, one of our main responsibilities is finding and keeping the right people for our business.
So, how do you go about finding the right person? After finding them, how do you keep him or her? Hopefully, as you read it, this article will help you in the most baffling of all business challenges - human resources.
The first step in recruiting is to make sure you have a job someone would want. This means offering a competitive pay package and the same or greater benefits than others in your industry. Itâs generally not hard to find out if your total compensation package is competitive. You can use an online service that provides statistics on pay packages offered to employees in your area. You can also pick up the telephone and ask some of your peers what they pay and what benefits they provide.
Next, you must let potential job applicants know about the opening. There are a number of ways to do this: you can simply post the opening on your website or take out a classified ad to announce your need. One of the more popular ways to search for new employees is by advertising on one of the large national or regional âhelp wantedâ websites. Depending on your industry, you may be able to ask people you know if they are aware of anyone looking for a job.
Current employees can also be a source of leads. As Generations X and Y make up a greater percentage of the workforce, some of these employees have held several jobs prior to coming to work in their present position. They may well know who in your area is looking to make a move. Many employers in the accounting profession are taking this route. Some simply ask their current employee without incentive, while others are providing "referral fees" to the worker who helps recruit a new employee.
Another alternative may involve the use of employment agencies. In the right circumstances, this could pay off, but beware: employment agencies can be expensive.
Once you have begun receiving responses to your advertisements, the process of hiring an employee is fairly straightforward: bring the job applicant in, have them fill out an application, determine whether to proceed with hiring them and, most importantly, check references. This is one step that is often overlooked, because many interviewers feel they are a good judge of people. This could be, and has been in the past, a big mistake. In an hour interview, itâs impossible to find out everything about a person and the insight of references and former employers can prove invaluable.
The Compensation Package
Compensation isnât only pay and monetary benefits (tangibles), but also includes intangibles like time off, career advancement opportunities, etc. (intangibles). Letâs take a look at how compensation affects an employeeâs decision to work for your company - and their decision to stay with it.
Cash compensation is, of course, a major factor in a prospectâs decision to work for you. As mentioned earlier, take the time to research competitorâs pay scales and make sure you are in the same ballpark as they are. Thereâs nothing more frustrating than seeing good prospects leave when they could have been kept for just a small increase in pay.
Benefits, while not the prime consideration in most cases, can tip the scales in favor of your company. Health insurance is a key concern of many potential employees, especially if they have children, but it is also a very expensive benefit. If you do want to offer this benefit, be aware that you will probably have to include all employees in your health plan - and the premiums are not cheap!
Providing a retirement savings vehicle is also a point in your favor. With the decline in traditional defined-benefit plans, employees must look to themselves to provide for retirement. Providing a 401(k), SIMPLE or other qualified retirement plan is a big plus for your company, especially if you match employee contributions and regularly declare profit-sharing contributions.
Many older employees and employers still have the attitude that work comes first and taking time to attend a childâs ball game is not very important. This is not so with younger employees, who are often willing to forego some level of cash compensation in return for more time to pursue their lives outside of work. This can be in the form of vacation benefits, sick days, personal time or other paid time-off schemes. One powerful tool is the use of flex time: though not possible in every business, providing an employee with the ability to set his or her own hours carries a lot of weight. Of course, you donât want chaos at the office if all your employees are gone at the same time, so set clear parameters on what is acceptable.
One employee need that is constantly mentioned in employment surveys is a clear path for growth and advancement. Make sure your employees know their options and be consistent on follow-through. Provide clear goals, reward performance (even if itâs just telling the employee they did a good job) and provide feedback on how they can improve. Where possible, provide your employees with outside training to help them progress in your company.
In many ways, the current employee market is a lot like a sellerâs market in real estate. You need to be competitive to attract new personnel and, to be competitive, you must be creative. If you need some advice on attracting good people, give us a call and letâs kick around some ideas that might help you.
Have a great Thanksgiving.
These articles are intended to provide general resources for the tax and accounting needs of small businesses and individuals. Service2Client LLC is the author, but is not engaged in rendering specific legal, accounting, financial or professional advice. Service2Client LLC makes no representation that the recommendations of Service2Client LLC will achieve any result. The NSAD has not reviewed any of the Service2Client LLC content. Readers are encouraged to contact their CPA regarding the topics in these articles.