Hiring and retaining employees is one of the leading challenges many small businesses face. In today’s competitive labor market and a potential recession, it’s even more challenging.
The good news is that many outstanding potential employees would prefer to work for small businesses! Read on to learn recession-proof hiring tips to help you find and keep the best employees while growing your business.
Economic uncertainty can make hiring harder
Whether the U.S. economy is “officially” in a recession or not, any type of economic uncertainty can make it harder to predict and manage your hiring needs. Add in the ongoing labor shortages, and it’s understandable that you may feel stressed by the idea of keeping your employees and bringing on new ones.
You might be worried about how inflation and a resulting economic slowdown will impact your business’s cash flow. These conditions can make your day-to-day operations more difficult to predict and make it harder to know whether you should hire staff or if you can afford to keep them for the long run.
With some planning and preparation, and a little bit of creativity, you may find that now’s the best time to hire and retain a top team.
Nothing lasts forever, including recessions
First, remember this: economic downturns and upcycles don’t last forever!
Though every recession and the resulting recovery are slightly different, the historical data shows that on average, modern recessions last less than a year. This means that you can focus your creativity, human and financial resources, and energy on how to best position your business for the next 12 to 24 months.
By focusing on this, you’ll have more control over your business’s future and can make decisions that will benefit your business now and set the stage for a thriving, post-recession recovery.
Five top hiring tips to find and keep great employees in uncertain times
1. Strengthen your business’s financial position
There’s no getting around it: When your business has the financial resources to get through challenges, you’re better positioned than your competitors that don’t. This also gives you a leg up when it comes to attracting and keeping the best employees.
Now’s the time to run best-case, most likely, and worst-case scenarios for your cash-flow projections. One way to do this is to test how your business would fare if your revenue was reduced by 10% (a rough estimate of the current impact of inflation), 25% (a moderate recession), and 50% (a severe downturn).
Then, calculate whether you’ve got enough working capital for your business to survive or even use a downturn as an opportunity to bring on your dream team.
If not, talk with your bank or credit union, or a reputable lender, about financing options to build your cash reserves. Securing the funding you need now ensures that you can get through tough times and take advantage of hiring opportunities that your competitors may have to sit out.
2. Create a hiring and retention plan that includes changes in staffing or workflow
A critical piece of your business plan should focus on building your team. Start by finding the answers to these questions:
- What are your short- and long-term staffing needs?
- What do the key roles look like for your business and what are the experiences and skills needed to fill them?
- How will you manage any changes in staffing or workflows?
While it may be challenging to answer these questions, the good news is that there are experts out there who can help! There are low-cost and even free resources available to you, such as the volunteer professionals with your local Small Business Development Center (SBDC). You could also consider working with a business coach, or outsourcing certain responsibilities to third-party experts.
3. Communicate your business’s strengths to job candidates
It’s always important to talk with your employees to let them know where your business stands. This is just as important to convey to your prospective employees, too.
During interviews, candidates are figuring out if your business is a good fit for them just as much as you’re determining if they’re a good fit for the role. Keep in mind that for potential employees who are looking for work during economic uncertainty, their fear is that they’ll accept a position, only to have their hours reduced or, even worse, be let go.
Even though it sounds strange, that’s exactly why this can be a great time to find and hire excellent employees. If you can foster a sense of calm and confidence among your team now when the waters are a bit choppy, then you can create a loyal and engaged team for the long haul. You don’t have to share specific details, but letting candidates know that you’re prepared for bumps in the road could make them more open to a potential offer.
4. Identify your hiring channels
If you’re looking to fill an open position, be sure to identify which hiring channels are the most effective for your industry and the role. Here are a few questions to think about:
- How did current employees in similar roles find your business?
- What channels are competitors using to attract candidates?
- How have your best employees found out about opportunities with your business?
Knowing the answers to these questions can help you focus your time, energy, and financial resources on hiring channels that can get you high-quality candidates.
5. Build a talent brand
To hire and retain great employees, you need to establish your business’s talent brand. Your talent brand can be one of your most powerful tools to attract potential employees, especially when you’re competing against larger, well-known businesses. Start by learning about and addressing your employees’ social, emotional, and technical needs.
What does your talent brand communicate? It should demonstrate that your business is a place where people want to work! By building and promoting an environment that lives your business’s and employees’ values, you’ll attract the high-quality candidates you’re looking for while keeping your whole team motivated and engaged.
Pursuit can help you get the funding you need to hire and keep the best team
Whether you’re ready to hire or simply preparing for whatever’s ahead, Pursuit can help you get the funding you need. We have more than 15 loan options available for small businesses in New York, New Jersey, and Pennsylvania to help you launch, grow, survive and thrive. Contact us today to learn how we can help.