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Tight Labor Market

5 Ideas for a Tight Labor Market

Tight Labor MarketAccording to the NFIB, the number one concern of 23% of small business owners these days is the tight job market. In fact, 83% of those trying to hire reported few or no qualified applicants. If you find yourself in this situation, what can you do? Here are 5 ideas:

1. Increase productivity

In keeping with Mies van der Rohe’s thought that “less is more,” if you can get your existing staff to become more productive, you may reduce the need for additional workers and continue to grow your business. Two key words I like to use for boosting productivity are encouragement and reward:

  • Encourage performance. This means having the company support employees in their personal lives as well as in the workplace. For some workers, it may be permitting flex time for them to have a better work-life balance. For others, it may be formal mentoring to grow with the company. The beauty of a small business is being able to tailor solutions on an as-needed basis.
  • Reward. Consider a variety of financial incentives for employees who step it up. This may include bonuses tied to productivity and promotions with higher pay.

2. Use technology

Consider using various types of technology to automatic tasks that previously had to be done manually. For example, customer relations management (CRM) programs can provide sales assistance by automating leads, scheduling, etc. Also use technology for productivity purposes (e.g., setting goals and measuring results).

And think about AI for your company. Can you use tools for data analysis? Is there a place for the use of robotics?

3. Train existing staff

According to The Balance, training and development motivates your staff. If your company’s growth demands new skills, consider training your current workforce to handle them. This can be done by:

  • Paying for higher education. The company can write off the cost while employees can enjoy a tax-free fringe benefit (no employment taxes either).
  • Doing in-house training. Brown-bag training, a lunchtime activity, can bring workers up to date on new methods and skills.
  • Implementing mentoring programs. Assigning senior staff members to work with newer employees can be very helpful. Also consider “reverse mentoring” where younger (more technologically skilled) employees mentor older workers in social media and other tech activities.

4. Be more flexible

When it was easier to hire good workers, you may have been stricter about punctuality, workplace attire, and other matters. Now that things have changed, you have to become more accepting of certain things. Of course, you don’t have to lower your company’s standards for job performance. For example, you should continue to require top notch customer service skills from employees who deal with your clients and customers.

5. Outsource

When you can’t meet your workforce needs by using the ideas discussed earlier, consider outsourcing. This can be done through:

  • Using temp workers. You pay an hourly fee to a temporary employment agency for the type of work to be done. The workers are employees of the agency, and bear all employer obligations
  • Engaging independent contractors. You can do this by contracting with someone directly, such as a former employee who may want to do some part-time or project work for you now. Or you can go through an online platform for this purpose (e.g., Upwork, Fiverr, and Freelancer).

Final thought

With small businesses competing with big companies for talent, you have to get creative. It’s likely you can’t compete on wages and benefits packages, but you can offer a work environment to keep your current staff happy while meeting your business’s needs.