What will it take for Small Business Owners to Recover from the Labor Shortage?

The situation due to the Covid-19 pandemic has caused Labor Shortage and due to which the small business owners are suffering from difficulties. On the one hand, there are still many companies and sectors trying to overcome the financial crisis caused in the year 2020 and just began to open all over again. Whereas, the small business owners are unable to retain and draw the best talents since it’s a job-seekers market, after all, hence the situation is creating a lot of pressure.

The number of employment opportunities has increased up to nearly 15 million, from 10 million before the beginning of the pandemic. Now, there are even more job openings that were also available before the covid-19 crisis, and so, the business is facing a difficult phase to attract the best-qualified talents.

In April 2021, about 6,50,000 workers resigned from their jobs, and along with the companies like Under Armour, Best Buy, and Target, all of increasing their minimum payment of wage to $15 or above, how the small businesses can cope up with this in case they are not in the situation to afford such pay scale?

Robust unemployment payoffs, growing concern towards health, laid-off workers, changes in career, 4th stimulus check, responsibilities towards their child/ children are some of the main causes due to which the workers are hesitating to come back to the workforce. The conflicts among experts are addressing what if the changes in the minimum wage rate are only for a while or if the same becomes the cause of permanent increment of wages.

In the meanwhile, small business owners need to rise to the challenges. Here are the four things which small businesses need to incorporate to draw new talents as well as uphold the existing employees amidst the labor shortage.

Reward Best Performers

If the companies and small businesses tend to reward their best performers, the same can aid to increase the productivity, uphold the existing employees, and can even help to draw new fresh talents. This is because if the employees will feel that they are getting appreciation and also valued for their performed work they will feel more encouraged to perform their duties in the best possible ways.

This will also make employees stay involved at the workplace and they will also tend to refer their workplace to their acquaintances. The small business can also consider providing bonuses upon reaching certain targets.

It has been seen that bonuses prove to be less expensive than salary increments and can also play a major role in developing a sense to be more productive. You can also express your appreciation to the best performers by communicating thanks orally, providing additional off time, bearing transportation expenses, or you can even present them with a small gift. While including these don’t be biased towards your employees.

Get Creative With the Budget

In case your competitors are continuously leaving you behind when it comes to payment of wages then you will have to raise your employee pay scale, sooner or later, since this will help you to draw the best talents. However, there are multiple ways for you to simplify your financial strain, you don’t raise the pay scale on the cost of your bankruptcy after all. For beginners, have a look into the government plans or grants which reward small businesses for employing minority class, veterans, physically challenged workers, former offenders, or local people. There are many programs by municipality or state which provide tax credits and other benefits for modifying and expanding your employees.

The other option is that you can also lookout for a business line of credit or small business loan. These options can support you to ease cash flow disturbance, pull off with short-term expenses and you can even look to invest in bigger projects and drives.

Personalize Your Incentives

One of the many benefits of having a small business is that you can have greater control and adaptability when it comes to offering incentives to employees.

The big companies need the consent of board members and others to design and approve any compensation structure whereas you can have the liberty to work on customized incentives and execute them quickly.

Apart from rising wages or bonuses, incorporate new employee incentives which focus on more paid-time-off, the share of profit, or even providing best performers a small percentage in your company. Additionally, you can also choose to include Health Insurance, retirement plan and even opt to reimburse the tuition fees of your employee’s children, the last option may seem like a considerable commitment but the tax policies grants tax incentives to those businesses who step up to bear the expense of the education of employee’s children.

Utilize Existing Technology

Digitalization and Automation have been expanding for a couple of years but they have become the most important since the pandemic began. Many companies were bound to inhibit technological tools in their businesses to manage and track their daily work operation so that they can follow social distancing norms during the lockdown.

Many retailers shifted online, restaurants hired zero contact delivery apps and some even reduced their workplace and applied for work from home permanently to the employees. Although you won’t be able to do everything digitally because you still need your employees to operate your business, you can always shift to be technically strong and use the resources for your current workers rather.