Hiring on the rise for small businesses

Carol Anderson, left, owner of Vaguely Reminiscent, a clothing store on Ninth Street in Durham, N. C., works with part-time employee Bridget Gordon on Aug. 22 as they sort jewelry purchased during a recent trip to New York.  Anderson said hiring the right part-time salesperson is essential to her small business.

Chuck Liddy | Raleigh News & Observer

DURHAM, N.C. — If you want a job at the quirky, but compact Vaguely Reminiscent store here, be prepared to do the job interview in the changing room that also serves as a bathroom and office for the 600-square-foot women’s clothing and accessories boutique.

“We bring them into the bathroom and we set up little stools and somebody sits on a toilet and the other two of us sit on the stool,” said Carol Anderson, owner of the 31-year-old store run with the help of a team of six part-time employees. “And here’s the deal, if they can’t deal with that, they are not going to be happy here because it is very claustrophobic.”

That’s just one of the methods that small-business owners use to find the right person to fill a role on their team.

“Without good employees, the business can’t function, because it means I can’t comfortably walk away,” Anderson said.

Job creation at small companies appears to be increasing, according to statistics compiled by payroll processor ADP. In July, businesses with 49 or fewer employees added 82,000 employees, which is 9,000 more compared to the same time last year, according to the ADP National Employment Report.

Meanwhile, the National Federation of Independent Business’ July monthly survey indicates that 50 percent of small-business owners hired or tried to hire in the past three months and 40 percent reported few or no qualified applicants for open positions.

Keys to hiring

Finding the right candidate, experts and other small-business owners said, takes planning, careful digging and a structured transition from recruiting to retention.

Small-business owners should recruit candidates before they have an opening, said Craig Stone, founder and CEO of Hire Networks, a Raleigh, N.C., firm that offers executive and strategic hiring services.

“Some of our best employees, it took a year to recruit them,” Stone said. Owners should identify candidates and let them know when the right position comes open, Stone said. They may say no at first, but change their mind if the situation shifts.

“My advice to employers is always hire slowly and fire quickly,” said Phyllis Hartman, a member of the Society for Human Resource Management’s Ethics Panel and president of her firm, PGHR Consulting, near Pittsburgh.

“Taking the time means you won’t have to fire someone or you find someone that matches you better.”

Small-business owners often fail to plan out the hiring process, Hartman said, which starts with identifying holes that need to be filled in the organization and writing out the skills a candidate needs to thrive in that position.

“If you don’t figure out exactly what it is you need, it is very easy to hire the wrong person,” Hartman said.

Reach out

Small-business owners should reach out to local community and technical schools and be open to using modern recruiting channels.

“You need to kind of step back and say, ‘Where are the people that I am looking for most likely to be looking for jobs?’ “ Hartman said.

Recruiters also should determine interview questions beforehand to ensure consistent experiences with each candidate, she said.

Recruiters should ask questions about a candidate’s response to challenges, situations and accomplishments in other positions, Stone said.

“Having them come up with examples where they specifically were able to save the company money, or make the process better,” Stone said.

Reference checks

Other steps include background and reference checks.

“Those are kind of digging conversations to find out as much as you can,” Stone said. Recruiters should ask references questions about an employee’s strengths and weaknesses, how they got along with other employees, and in what areas the new company could help the employee improve.

When recruiting, small companies should emphasize their own strengths, Stone said, such as mentors or a laid-back culture.

“If you don’t have a good story to tell, then you are going to struggle,” Stone said.

About one-third of employers track what competitors pay similar employees, but about 35 percent don’t factor in that external compensation, according to a spring national survey of workers, hiring managers and human resource professionals conducted by Harris Interactive on behalf of CareerBuilder, a global human capital solutions company that’s affiliated with The McClatchy Co., owner of The News & Observer and partner in McClatchy-Tribune News Service.

Rosemary Haefner, CareerBuilder’s vice president of human resources, said that the practice hinders the search for skilled labor.

Small-business owners should be honest about management styles, the company’s strengths and job descriptions, Stone said. Once a candidate is hired, Stone said, that person should understand what it will take to be successful in the next three months to five years.

“You see it all the time, people focus on recruiting and not really on retention,” Stone said.

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