How are SMEs attracting talent?

SMEs are often at a disadvantage in terms of wages when it comes to attracting the best employees. What are some other benefits they should then focus on?

According to the March report of the Canadian Federation of Independent Business (CFIB), the average rate of vacancies in Canada stood at 2.5%, while that number was 4.6% among small firms (between 1 and 4 employees). Thus, SMEs must work harder to attract workers’ attention.

But when the business owner is also the human resources department, finding a candidate can be extremely frustrating. According to a 2014 Business Development Bank of Canada survey, 84% of Canadian SMEs actually have no one to deal with human resources.

Although, 97.8% of all business establishements in Canada are in fact SMEs with fewer than 50 employees.

Closer to the people


Simon Gaudreault, an economist with CFIB, says that SMEs have one powerful weapon of persuasion against the wages being offered by large companies and government institutions: their human side. “SMEs should develop these natural advantages. They offer a more personalized environment, with closer proximity to management.” This is why SME job offers must be customized and share that entrepreneurial culture and this type of living environment in their postings. They must also clearly demonstrate how their employees are members of a larger family, rather than simple numbers.

Employers should also remind candidates that employement within a SME entitles them to a lot of autonomy and easier participation in the development of the company. SMEs can therefore find those candidates who aspire for greater responsibility and appreciate the diversity of tasks. “Those who do not like hierarchy will be well served,” says Gaudreault.

If SMEs cannot offer a competitive salary, they can offer a creative and very flexible scheduling environment. According to the BDC, approximately 55% of SMEs offer flexible hours to their employees, another 20% offer the option of telecommuting and 18% give their workers the choice of part-time employment. For example, if a large company offers on-site childcare, an SME will offer parents more flexibility in terms of schedule, states Gaudreault.

Where to find candidates?


The traditional method of word-of-mouth is still valued by many SMEs. In fact, recommendations seem the norm when it comes to recruiting: employee referrals (42%), business networking (38%) and friends and family members (35%).

Thus, employers recruit people from the community from which they take root, explains the economist for the CFIB. “Many people want to work locally and need this closeness. This is an attractive factor.”

However, Gaudreault also suggests SMEs resort to other unconventional pools of potential candidates: younger people with little experience, those with lots of experience and immigrants. “It can open up new opportunities and maximize chances of recruiting.” In this context, local job fairs and partnerships with nearby schools may all be good sources for new blood.

Moreover, the hiring of apprentices or trainees is a great way for SMEs to find new talent. “SMEs are good training schools. And many people decide to stay and make a career in a SME,” says Gaudreault.

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