A quick glance at the news says it all: employees are a hot commodity today. In fact, a 2021 survey of HR professionals found that recruiting and hiring was their number one concern. Between the great resignation and a quest for companies to get the best of the best on their teams to help them rebuild—and even grow—following pandemic shutdowns, it’s enough to make any business wonder: is it time to start hiring again? Identifying the Right Time to Hire You’re busy. Overwhelmed. Doing the jobs of three people and/or two teams. So it’s time to bring on more help to take on some of the tasks, right? Before you do, think about what you need to have done. The easiest way? Start by drafting a job description. If the tasks on the job description are related and can be rolled into a single, focused position, whether full-time or part-time, hiring may make the most sense since it helps you secure expertise that other team members may not have as well as the manpower needed to reach the company’s goals. Plus, if you worked a corporate job before starting your small business (like 32% of respondents in a survey by Digital) you probably already know the realities of being understaffed: deadlines get missed, calls go unanswered, clients may be left unattended, and employee stress and turnover skyrocket. If, however, that job description looks like a disconnected mess of unrelated and/or small, it may be smarter to outsource individual tasks to contractors instead. Plus, there can be additional drawbacks to growing before it’s absolutely necessary, with the most obvious being the hit to your company’s finances. Bigger teams are also subject to additional labor laws; support teams, like HR, also see an increase in responsibilities with each new employee; and the current competitive job market could put you in a situation where a new employee requests a higher salary than existing employees who perform the same job. Quick list: Advantages and Disadvantages of Hiring Now Advantages Disadvantages Existing team members can focus on the job they were hired to do New team members cost more than just their paycheck: consider benefits, taxes, etc. Customers and clients get the attention they need A larger team may make your business subject to additional labor laws and local and federal regulations New team members bring fresh perspectives and ideas and can add to the team’s diversity Training, payroll, and HR efforts will also increase to accommodate new team members Adding to the team can help your business expand and make more money Competitive hiring may make a new employee more “expensive” than existing employees So how do you know if the time is right for your small business to hire one new team member or more? Consider the following situations before making your decision: Hiring to Lighten the Workload “ sign that it’s time to hire is when you look up and notice that your employees are busy—really busy,” recruiting site Monster.com recommends. “Perhaps you were too busy yourself to notice. If so, your next step is to verify that the elevated levels of work you’re seeing are sustainable. If you confirm that the boom will last, then it’s time to hire.” However, before you hire, ensure your business can handle the new costs and overheads caused by a growing team. Beyond wages and benefits, consider unemployment tax, worker compensation insurance, Medicare taxes, Social Security taxes, recruitment costs, training time, payroll expenses, new equipment and space, and even software licenses. “Once you’ve got a realistic idea of the potential cost of a new employee, try to align this cost with the benefits you’ll get from that new employee,” Lisa Furgison of Bplans suggests. “How much new work will you be able to take on? Take a look at your income and expenses from the previous year to assess whether you have the capacity to afford someone. If it looks possible and profitable, consider your pipeline and cash flow.” Hiring to Stay Competitive As long as your employees are skilled and savvy, a bigger team can also mean you can take on more business and/or expand into new markets. And if you stay too small for too long, you’re likely losing customers to businesses with the bigger footprint. “You won’t even have a chance to retain customers if you turn them away from the start,” writes entrepreneurship expert Neil Patel. “These customers will go to your competitors and form relationships with them instead of you. Feeding your competition new customers will put you out of business.” Hiring to Grow Your Business Beyond staying on top of your current workload, a bigger team can help you to discover and tackle revenue streams you hadn’t even considered before. Maybe a new employee specializes in a type of work that can bring in new customers. For example, if you run a printing business, you might find that hiring someone who designs logos could bring in a whole new source of revenue and provide added value for your existing customers. Feeling Confident about Your Decision to Hire... Especially if you are used to being your only employee, like a freelancer or solo entrepreneur, or one of very few, understanding when and how to bring on a new staff member is vital. But whether you are looking to hire your first employee or your 50th, it’s always essential you feel confident and comfortable that you’re ready to grow. And while a new team member could be just the ticket you need to help your business grow, if current finances are holding you back from expanding your team, certain small business financing options could help you over the hump of hiring and training.