In August 2021, 4.3 million Americans quit their jobs in what would come to be known as The Great Resignation. This severely impacted many employers who were already struggling to attract quality candidates in the midst of a labor shortage. To them, the message was clear: The labor market has fundamentally changed, and it’s time to adapt before the competition beats you to it.
But shifting gears can be a tall order for major corporations — let alone small businesses.
According to the National Federation of Independent Business, 49% of small businesses had job openings that they couldn’t fill in July 2021. This has left many small-business owners wondering how they can keep up with the competition. While it will be a challenge, small businesses are more than capable of attracting the same quality talent that large corporations do.
It all starts with knowing what workers need in 2022.
This reshuffling is confirmation of a greater shift in worker expectations that had been building over the last two years. Employees are fed up with stressful work environments, long hours, unsupportive managers, and mediocre corporate culture. In fact, many have adopted a different perspective on the purpose of their careers in general.
In a recent survey, just 17% of participants said that their job was a source of meaning in their lives. That’s down from 24% in 2017. In other words, more people are viewing their jobs as secondary to their families and hobbies. This means that employees have started to prioritize work-life balance and flexibility in their jobs over raw pay.
Employees also have different preferences for their workplaces when it comes to remote and hybrid work. It’s estimated that 74% of workers expect remote work to become the norm, and 61% of workers prefer remote work. This is no surprise, since many people worked from home for the first time in their careers during the COVID-19 pandemic. That shift made many people realize that their presence in a physical office wasn’t necessary, and this has led them to favor remote opportunities. Employees feel that remote work is more flexible and gives them opportunities to travel and spend time with their families.
So, how can small-business owners compete in this new labor market? There are a few things you might want to include in your compensation package.
- Give more opportunities for remote or hybrid work. If you’re in an information-based industry, this could be just the edge that you need to attract and retain quality employees. Not only do many employees prefer remote work, but working remotely can also help you cut down on costs like office rent, utilities, and overhead. You can also attract a broader pool of qualified candidates since you won’t be constrained by location.
- Grow great company culture. Nobody wants to work in an environment where they feel like a cog in a machine. That’s why building a company culture is so important. When your employees are excited to work and collaborate with their teams, they’ll become more invested in their jobs. That means less employee turnover.
- Offer more vacation time, better insurance, or other perks. Some companies have started offering gym memberships, mental health services, and even pet insurance to entice great employees. Something as simple as a $20 health stipend per month can send the message that you value your workforce.
- Offer competitive pay. People want to be compensated fairly for their work. As wages increase across the board, make sure that you’re offering prospective and current employees what they’re worth.
With just a bit of extra attention, you and many other small-business owners can compete for the same coveted labor that corporations do. You just need to prioritize employee well-being, provide a superior company culture, and ensure you are offering competitive compensation.