Talent could be one of the biggest areas of competition for small and midsize businesses right now.
After 10 years of economic expansion, the labor force is simply tapped out. And yet, more than half of CEOs (56 percent) still plan to expand their workforce in the next year. That’s according to the Q2 2019 Vistage CEO Confidence Index, which surveyed 1,463 CEOs from small and midsize businesses. This survey conducted by my company found that more than half (56 percent) of small and midsize businesses plan to expand their workforce in the coming year.
And given the full labor market, the 37 percent of small and midsize businesses that plan to maintain the size of their workforce will need to hire to replace employees that were recruited away.
What’s more, 70 percent of small and midsize businesses say that retention is key for talent management. To find and retain the very best people, your company needs to offer best-in-class recruiting, onboarding and development programs. Here are five ways to do just that.
1. Shift your focus from hiring to recruiting.
To attract top talent to your company, you have to do more than post vacancies on online job boards. You need to implement a multi-channel strategy that gets both passive and active job seekers to pay attention to your company.
This might mean, for example, creating messaging that promotes your company as a destination workplace. It also means that you should always be recruiting, even when you don’t have a job opening.
2. Leverage your employees as recruiters.
Develop a program that encourages and compensates employees for referrals, and consider creative alternatives to the classic bonus. For example, reward new hires and their referrers after meeting a key milestone, such as a six-month anniversary. Our survey found that more than half of CEOs rated employee referrals as a “very effective” or “extremely effective” hiring tactic.
3. Invest in your own people.
If you can’t hire the right people, train the ones that you have. In our survey, 42 percent of CEOs said that training and development was “very important” to their talent management strategy. Development also drives employee engagement and retention, so this is an investment with a long-term payoff.
4. Create better compensation packages.
In a tight labor market, companies have to offer competitive compensation to secure top talent. According to our research, boosting wages and adding benefits are among the top three tactics used by small and midsize businesses to attract talent (development is the top tactic). If you’re not able to boost salaries and benefits, then offer your employees something else — such as training programs or technology perks.
5. Leverage onboarding as a retention tool.
Give new hires a positive experience with your company from day one. A well-designed onboarding program can increase employees’ productivity in the short term and increase their retention in the long term. It can also encourage new hires to recommend your company to their peers. In our survey, 41 percent of CEOs said onboarding was critical to their retention strategy.
There is no peace in the talent wars, so be sure you have the right strategies in place to ensure you have the talent you need to reach your goals.