January 11th, 2022

The #1 HR Challenge for Small Businesses In 2022

Staffing and talent issues are not just the top HR challenge in 2022, but the biggest challenge for small businesses overall.

The Bureau of Labor Statistics reports the national quit rate is 2.9%—up 30% from 2020. It’s safe to say every employer has felt the impact of turnover. But it’s not just retaining employees that have become problematic—hiring them has become more difficult too. 

And for small businesses, this trend has proven especially challenging. Small businesses don’t often have the funds to compete with larger businesses’ wages and benefits. Further, the time it takes now to source candidates is taking business owners away from other business objectives. 

Unfortunately, staffing troubles will continue in 2022. Though there are many challenges to expect, business leaders and HR professionals agree that talent is a top business priority for next year. 

The variety of talent challenges that business and HR leaders can expect:

  • Difficult recruiting
  • Retaining employees
  • Improving professional development and training of new hires
  • Managing a remote workforce

Why Is Staffing So Challenging Right Now? 

In 2021, unemployment benefits had some part in keeping employees from the job market. But now that many unemployment benefits have ended, staffing is difficult for other reasons: 

  • Workers are making changes in their lives due to the pandemic, burnout, and changing values. 
  • Employees are looking for more flexibility, growth opportunities, better benefits, and work-life balance in their next opportunity. 

Insider reports that the job market is on track to regain all jobs lost during the pandemic by February 2022. But that doesn’t mean that hiring and retention will get easier. As the reality of remote work and a new normal sets in, employees will continue to make changes. 

Download Our Guide: How to Retain Your Employees

Check out the top 4 reasons employees leave and multiple ways to address them.

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How Small Businesses Can Overcome HR Challenges

Employers will need to determine how employee expectations are shifting for their specific industry. For example, small businesses in industries such as healthcare, retail, hospitality, and foodservice were struggling to find workers willing to put themselves at risk of exposure to COVID-19. But now it’s not just that—workers don’t want to go into a work location at all. 

Businesses that want to attract and retain on-site employees in the industries above will have to offer incentives to employees that might be new to them, such as: 

  • Signing and retention bonuses
  • More flexible hours 
  • More recognition
  • Perks

Small businesses in any industry can also take a different approach to how they source candidates by networking to hire or adjusting job requirements. 

But every business will have to do something to keep employees from quitting. To attract and retain top talent, every organization should use this time to reassess their benefits, wages, culture, and location requirements to remain competitive in the job market. 

To get more time to spend on talent management and your talent needs, consider an HR partner. An HR partner can cover your administrative work so you can spend more time on the recruiting, training, and professional development of your employees. Reach out to us to learn more! 

Download Our Guide: How to Attract Top Talent

Download this guide to learn five strategies to attract top talent and improve your hiring process.

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