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IncHow to Attract the Best Employees (and Keep Them)
Salary plays a major role in all hiring decisions, but when it comes to attracting the best job candidates, money isn't everything. Here's why.
Midsize businesses might not be able to offer the same compensation as their larger rivals, but that doesn't mean they can't attract top talent.
Companies in the U.S. middle market often have less bureaucracy and a shorter path to the top than their larger counterparts, two characteristics that can provide an edge when competing for talent. When trying to persuade a prospective employee to join one middle-market company over another, however, two of the most important factors are the "employer brand" and the "employee value proposition," according to a recent report from the National Center for the Middle Market, a partnership between GE Capital and Ohio State University's Fisher College of Business.
The report defines an employer brand as a company's "image and reputation as a place to work as perceived by its current employees, prospective candidates, and the general public." Aside from salary, an employee value proposition includes things like benefits, job security, company culture, opportunities for advancement, and "non-monetary incentives such as recognition and rewards."
A recent survey of more than 400 C-suite executives at middle-market companies shows that businesses with a well-established employer brand saw employment grow on average more than 12 percent during the year ending December 31, 2014, compared with less than 5 percent for companies with an employer brand that needs work.
Midmarket companies with the best employee value propositions, meanwhile, experienced average employment growth of approximately 10 percent last year, compared with 5.5 percent for those with an employee value proposition that needs work. A strong employee value proposition can also increase employee loyalty, according to the study.
So how can entrepreneurs create strong employer brands and employee value propositions at their companies? Offering a strong work-life balance and plenty of growth opportunities are two ways to appeal to prospective employees, but other factors include:
Offering face time with the CEO
Giving back to the local community
Providing a relaxed dress code
Offering flexible schedules
Creating access to great technology
Space for socialization and collaboration
In addition to being able to attract and retain top talent, companies with the best reputations and best employee value propositions usually generate the better financial results, the study found.
While developing a strong employer brand and employee value proposition doesn't require much, if any, financial investment, it does take a long-term commitment from senior management.
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