Attracting, retaining and engaging employees have always been fundamental to business success. According to Gallup, businesses in the top quartile of employee engagement achieve 21% greater profitability than those in the bottom quartile.
But sweeping demographic, technological and cultural shifts in the workforce pose a daunting challenge for SMBs: how to create an environment that attracts employees and offers them a productive and rewarding work experience.
- Five generations in the workforce. Gen Z workers are now starting to enter their prime working years, and older workers are waiting longer to retire. As a result, it’s possible for SMBs to employ five generations of workers—each which brings different attitudes, skills and expectations to the job. Generational preferences vary in everything from meeting preferences (in-person to online), writing styles (words to emojis) to family leave and health care needs. This makes creating a workplace that’s a great fit for everyone challenging.
- The workplace is being redefined. People want more flexibility about when, where and how they work. This includes opportunities to work at home, work flexible schedules, reserve quiet rooms to work at in the office, collaborate across different locations and more.
- The labor shortage. According to the U.S. Labor Department, the number of job openings exceeded the number of unemployed Americans by the largest margin on record in April. Employers are finding it increasingly difficult to fill open positions, which holds back hiring and growth. This problem is exacerbated by increased employee turnover, especially among younger employees. According to the U.S. Bureau of Labor Statistics, the overall median salaried job tenure of workers ages 55 to 64 is 10.1 years—more than three times that of workers ages 25 to 34, whose median tenure is 2.8 years.
- Rise of the gig economy. More people are making more of their income through freelance or contract work, instead of through traditionally-defined employee-employer salaried positions. The category Includes self-employed as well as temp workers, contractors, on-call workers and part-time employees, spanning industries from construction to pet care to healthcare; and from professional services, such as web design and programming, to Uber and Lyft drivers.
- Impact of technology in the workplace. From mobility to artificial intelligence and machine learning, and from augmented to virtual reality, technology presents a yin and yang challenge in the workplace. Consumer tech provides people with solutions that enable us to do complex things very easily—and we increasingly expect the same type of user-friendly applications at work—along with the ability to access and use data to do our jobs more effectively. But, while workers want to use technology to improve job performance, many also worry that technology may eliminate their current roles or future job opportunities.
Keeping Pace with Change
Navigating these trends can be difficult for SMBs, who have to compete with larger employers for talent. Big employers can often pay employees more, provide better benefits, and offer more extensive career paths. So, it’s not surprising that medium businesses (100-999 employees) rank “attracting new employees” as their top business challenge, and small businesses rank it as their third most pressing challenge.
Technology is playing a bigger role in helping companies to attract talent, and give workers the smart, connected and user-friendly tools that they increasingly expect to have in the workplace. Once again, large companies are more likely to have expertise and resources required to deploy new solutions to than resource-constrained SMBs.
While SMBs can’t wave a magic wand to solve these problems, they can take some concrete steps to keep up with these changes.
- Highlight and strengthen the positive attributes in your workplace. SMB Group’s SMB 360: Connecting the Dots Between Business and Technology Study indicates that SMB respondents are mostly upbeat about key elements of their workplace culture. Identify and concretely communicate the most positive attributes of your environment to prospective employees—and work to improve them to help retain your existing staff.
- Enable flexibility and mobility. The percentage of employees that telecommute and travel for business is rising. Employees increasingly expect to have the mobile devices and applications they need to stay connected and productive anytime, anywhere.
- Up your HR game with an integrated human resources solution to help attract talent. Many small and even medium businesses don’t use integrated human resources and talent management solutions, which help companies with workforce planning, recruitment, onboarding, learning and talent management. Fortunately, there are a growing number of solutions designed to help SMBs improve hiring and employee engagement, increase productivity and make better personnel decisions. Most are offered in a cloud-based, software-as-service (SaaS) model. This not only offloads the IT burden and provides real-time data for collaboration and decision-making, but gives employees easy self-serve access to the system.
- Increase flexibility and capabilities with contract workers. Salaried employees are the life blood of most businesses. But hiring can be a tough, lengthy process in today’s tight labor market. That’s why SMBs are increasingly tapping into the gig economy to help get work done, and gain the flexibility to scale resources up or down as needed. Online marketplaces, such as Upwork and Fiverr and Freelancer, make it easier than ever to find, manage and collaborate with contractors—who are frequently off-site, schedule their own hours, may have multiple priorities, and have little experience with your company’s mission.
- Take advantage of technology solutions that help people work smarter and that keep them connected and engaged. Staying on top of best practices and putting the right technology to work for your business will allow you to both automate and streamline operations, and to attract and maintain an engaged workforce. Look for business solutions vendors who build in your must-have capabilities—from reporting and analytics to natural language processing—into their solutions, so that you don’t have to figure out how to bolt them on.
Adapting to changing workforce and workplace expectations and trends isn’t easy—but is a requirement for business viability. Examine your current workplace culture, practices and technologies, and start moving to a more people-centric approach to help your business grow and thrive.
© SMB Group