Small Business Hiring

4 Hiring Mistakes to Avoid as a Small Business Owner

Aug 05, 2017 • 4 min read
Table of Contents

      U.S. small-business hiring has reached its highest level in 18 years, according to new data. The National Federation of Independent Business (NFIB) report shows that job creation among small businesses picked up in July thanks to strong economic growth in the U.S. and abroad.

      “Small business owners are investing their money in new jobs and we know small business is where the jobs are,” said Juanita Duggan, president and chief executive officer of NFIB.

      According to the report, 60 percent of business owners said they are hiring or trying to hire, but finding workers is an issue. Fifty-two percent of the respondents said they had a hard time finding qualified workers for the positions they are trying to fill, citing skills mismatches, weak work history, and unrealistic wage expectations as the biggest hiring hurdles.

      If you’re among the business owners who are looking to hire, you know just how hard it can be to find the right person for the job. It’s estimated that the average cost-per-hire is $4,129, according to a 2016 Society for Human Resources Management (SHRM) survey. Needless to say, it’s important to make sure you’re hiring the best fit for your business so you can minimize the high cost of turnover and frequent hiring.

      Consider these four common hiring mistakes that are critical to avoid as a small business owner, along with what you should be doing to hire employees that will help your business reach its peak productivity.

      1. Hiring in a hurry. Many small business owners can’t predict whether a candidate will perform well on the job after just one interview, but they’re so eager to fill a position they don’t take the time to revisit or refine the interview process. Oftentimes, business owners are not asking the right questions or getting any kind of second opinion. Spend some time tailoring your interview questions to determine not just whether a candidate can do the job, but also whether they are a good fit for your company culture. And don’t hesitate to conduct a second round of interviews and bring in other employees to assist you in truly vetting the candidates.
      2. Dismissing the value of contract workers. There are many benefits to hiring freelance staff—they’re not subject to the same federal wage and hour regulations as your salaried employees, not to mention the fact that many are readily available to get work done. Small business owners have been historically reluctant to hire contractors due to legal compliance and security concerns as well as employer-staff relationship fears. Others say freelancers are hard to monitor, but in many cases freelancers work harder for their clients than traditional employees. Freelancers are highly skilled and can be affordable if you shop around, and having a small network of trusted contractors is valuable any time you have extra work that needs to be turned around quickly.
      3. Overlooking technology in the hiring process. Being a small business owner may just be the definition of the word busy. And when you consider it takes on average about 52 days to fill an open position, you can see the immense value in streamlining and expediting the recruiting and hiring process. That’s where technology comes in.
        Explore recruiting apps such as Google Hire (designed specifically for small businesses), LinkedIn Recruiter, JazzHR, and Zoho Recruit to help you with identifying and building a database of talent, building candidate relationships and sharing information, managing applicants, and scheduling and tracking interviews.
      4. Refusing to delegate the task of recruiting. There’s a reason why larger firms have specialized human resources and hiring managers and teams. As a small business owner, you’ve probably dabbled in every aspect of running the business: payroll, marketing, applying for business loans, managing cash flow, and more. The more time you put into hiring and managing employees, the less you’re able to focus on things that drive revenue to your business. Turning your hiring needs over to a recruiting and hiring specialist ensures you not only bring on quality employees, but you can focus on developing products, setting up new partnerships, and bringing in new customers to grow your business.

      When it comes to hiring top talent, it’s all about finding the best fit for your business without feeling rushed to hire the first person who semi-meets your criteria. Use your time wisely, be selective, explore using freelancers, embrace technology and know when to outsource the process. It costs more to hire a new employee than it does to retain your existing ones, so if you hire right the first time, you’ll save time and money, not to mention get the best talent to help your business reach its full potential.

      About the author
      Melanie King

      As a reporter and editor, Melanie has written about everything from retail and tourism trends to economic development for regional newspapers, trade publications, and national magazines. As Lendio’s Director of Public Relations, she specializes in reporting fintech industry news and its impact on American small businesses. Melanie has a B.A. in Journalism from Brigham Young University. She is also a backpacker, runner, and mom of four.

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