Finding the right staff for your start-up isn’t always the easiest of tasks.
In recent years recruitment has become an acute challenge for businesses of all sizes, with the number of job vacancies in the UK rising to a record 1.3 million between March to May 2022, according to data from the Office of National Statistics opens in new window.
An increase in the cost of living, coupled with high inflation, is also hampering successful recruitment thanks to pressure on wages and employees able to pick from a large number of vacancies.
The increase of remote and hybrid working for some industries means geography as a barrier to employment is lower, enabling employees to work for businesses previously located too far from their homes.
As a founder, juggling recruitment alongside running a business can be time-consuming and ineffective.
The result is that smaller firms can see their growth slowed due to the lack of suitable, qualified staff.
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As part of our Learn with Start Up LoansOpens in a new window partnership with The Open University, our online course is free to join, delivered by experts and includes a free statement of participation on completion.
Common recruitment challenges for start-ups
Time-pressures on hiring
Hiring is generally not a quick or simple process.
You can easily find yourself spending considerable time researching salaries, job roles, creating job ads, placing ads, and reviewing applications.
Remote versus workplace
According to the Office of National Statistics, 84% of workers opens in new window in 2022 who worked from home during the pandemic intend to embrace hybrid work.
According to the BBC opens in new window, remote-job postings have increased by 329% in the UK, and the number of searches for remote working has increased by 790%.
Hybrid work allows some workers more freedom and control over their work/life balance.
But for start-ups who need face-to-face working and hands-on workplace activities, this attitude can prove challenging.
Lack of hiring experience
A lack of recruitment experience can prolong the hiring process for start-up owners.
Knowing how best to assess, shortlist, and interview applicants may lead to poor hiring decisions or unfair hiring practices.
Lack of resources
Start-up businesses may lack sufficient resources to fund employee benefits such as gym membership, bonuses, and extra holiday thatch help attract prospective workers.
Their lack of a proven track record or reputation can make it harder to attract staff, too, who may be concerned about the long-term viability of your start-up.
How to respond to recruitment challenges
Use free recruitment methods
Recruitment can be costly and popular recruitment tools such as Indeed and LinkedIn require payment to promote job ads.
Consider free recruitment resources, such as social media and your network.
Asking your network, friends, and family to spread the news that you’re hiring can add credibility to your efforts.
However, a social media recruitment path may only work if you already have an engaged audience.
Broaden the talent pool
It can be easy to target traditional recruitment pools when seeking employees, such as advertising on general recruitment platforms or seeking employees willing to work full time.
Yet this approach may limit who can apply for a vacancy.
Instead, consider accessing ‘hidden’ talent pools such as part-time and flexible workers or workers that other businesses overlook.
For example, older job seekers may have valuable experiences to draw on, while return-to-work parents or carers can bring much-needed expertise on a part-time basis.
Read our guide to hiring for inclusivity and diversity opens in new window for start-ups.
Take a flexible approach
Consider adopting a hybrid/flexible working model.
This can help employees reduce commuting costs and enjoy a better work/life balance.
It may result in quicker work with fewer distractions, according to the ONS opens in new window.
Flexible working hours, such as allowing time for school runs or after school childcare may also attract a wider pool of potential workers.
Use freelancers or contract workers
As of 2020, there were 2.2 million freelancers opens in new window working in the UK, according to not-for-profit self-employed organisation IPSE.
Freelancers can be cost-effective and deployed on tasks as needed without ongoing overheads.
Freelancers can bring expertise to a project.
However, availability can be challenging, and they may be less invested in your business’s culture and success.
Use a recruitment agency
Employment agencies can help overcome a lack of experience and resources when hiring.
Agencies typically charge a fee payable only when you employ someone they have recommended.
They often write the job ad, screen candidates, set up interviews, and provide feedback.
They can also ensure your hiring practices are fair and inclusive.
However, fees can be expensive – typically 15% to 20% of the employee’s annual salary.
Check to see if they offer a clawback facility, where your fee is returned if the new employee doesn’t complete a probation period, for example.
You may not need to hire anyone at all to solve your staffing issues.
Consider upskilling existing employees as an alternative to hiring.
There are free online training resources that can help with this, and many are divided into smaller sections that can be completed either in the employees’ own time or at work.
Offering training can also be an enticing benefit when posting job ads.
Learn with Start Up Loans opens in new window is our partnership with The Open University that offers courses to start-up owners and entrepreneurs to help them get their organisation off the ground and grow.
Courses cover subjects such as accounting, management, and business sustainability.
Want to understand the impact of work on mental health and wellbeing? Check out our free online courses in partnership with The Open University on wellbeing in the workplace.
Our free Learn with Start Up Loans coursesOpens in a new window include:
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Reference to any organisation, business and event on this page does not constitute an endorsement or recommendation from the British Business Bank or the UK Government. Whilst we make reasonable efforts to keep the information on this page up to date, we do not guarantee or warrant (implied or otherwise) that it is current, accurate or complete. The information is intended for general information purposes only and does not take into account your personal situation, nor does it constitute legal, financial, tax or other professional advice. You should always consider whether the information is applicable to your particular circumstances and, where appropriate, seek professional or specialist advice or support.