If you have staff shortages or other human resources issues, the answer is probably yes. Massive economic disruptions have resulted in many small businesses laying off or furloughing employees as they struggled to stay afloat during the lockdowns.

However, with most companies starting to open, the problem is getting their employees back or hiring replacements. Job openings in the United States exceeded 10 million in September 2021, meaning these jobs remain unfilled.

In the meantime, 4.4 million people quit their jobs in the same month, 164,000 more than the previous month. Big and small businesses are struggling to find staff, and each day they don’t fill their labor needs equals money lost.

In some cases, stores reduce hours or close because they don’t have enough staff to run it. Part of the reason for this seeming labor shortage is that people who made up the labor force now realize they have other options for jobs.

The stimulus checks they received during the pandemic serve as a cash cushion, allowing them to be picky about their jobs. As a result, small businesses often find it hard to compete with offers from larger companies.

Another reason is many small business owners don’t know how to attract the right people. They might know who they need, but not how to get them to apply for the position. Unless you have other options to solve your staffing issues, you might need to consider getting a recruiter to solve them for you.

Key Takeaways

  • The U.S. is currently experiencing a labor shortage, leaving small businesses struggling to find the people they need
  • Recruiting employees in-house costs much less than hiring external recruiters on average
  • But in-house recruitment takes significant resources away from the core tasks of a small business
  • Small business owners might not have access to qualified candidates that recruiters and staffing agencies have
  • Finding the right external recruiter is critical to recruitment success

How Do You Know It’s Time to Work With a Recruiter?

Since the economic situation continues to remain shaky, many small business owners may probably hesitate to incur expenses they consider unnecessary. Hiring a recruiter to find them the people they need likely seems like a luxury they can ill-afford. That might well be the case and hiring a recruiter or staffing agency does represent a significant chunk of change.

The average cost to hire one employee in-house is $4,129 while an external recruiter might cost you about 15% of the first-year salary of your hire. That means if you hire someone with an annual salary of $50,000, you pay the recruiter $7,000. You could consider recruiting software like Freshteam to help with your recruiting needs.

HR software qualities
Source: Freshworks

 

However, if you choose to go the recruiter route, you first need to give it a lot of thought and not settle on any external recruiter on a whim. Here are the signs that you might need a recruiter or staffing agency.

That Job Vacancy Stays Vacant

Despite putting out numerous job ads on all the best job posting sites you can think of, suitable applicants for your open positions remain elusive. One reason is that job postings often don’t attract qualified people, especially if you need to fill positions that have high demand like software developers.

People with skills that are in high demand don’t look for jobs on even the best job sites. Most of them don’t have to as the jobs come to them.

Recruiters know where to look for the best people for a job and proactively offer them positions. That ability takes some insider knowledge as well as an established process of attracting the best candidates.

Additionally, a professional recruiter or staffing agency knows how to sell an employer to candidates. That’s often useful when you’re a small business and not a recognizable brand.

You’re Busy Running Your Business

The hiring process takes a lot of time away from core tasks. Aside from crafting and posting job ads, you also need to look through resumes and contact those applicants that are a good fit for the position. When you have two or more that you like, schedule and conduct at least two interviews ― more if you’re hiring for a technical position ― for each one, make your selection ― in consultation with other stakeholders when necessary ― and present an offer.

After that, you need to onboard the hire as well. While the process sounds simple and hassle-free, consider the time you’ll be investing. Your time is valuable, and when you’re single-handedly running a business, you cannot afford to waste your time on noncore tasks like recruitment.

If your reason for not hiring a recruiter is to save money, you’re probably failing in that goal. Instead, hire a recruiter and use your time to make much more money than you spend on the service.

There’s Change in the Air

If you’re in the enviable position of growing your business, you likely need to hire many people. If you thought the hiring process for one person seemed like a lot of work, wait until you try to hire several people for different levels and specialized positions.

For one thing, that means multiplying the time it takes to carry out hiring tasks by the number of positions you need to fill. For another, you might not have the expertise to call on to review resumes for specific jobs.

For example, if you have an e-commerce business, you need a website. You can try building a website yourself with a website builder and save some money, but that’s usually not a great idea since your website is your bread and butter.

website builder
Source: Site123

It would be wiser to have someone develop and maintain your website, which usually means a web developer. Chances are, you don’t know anything about HTML and CSS, so you might not know what skills to look for in an applicant.

Avoid hiring the wrong people just because you desperately want to fill the positions. Instead, have a recruiter or staffing agency handle the whole thing for you. They know what they are doing.

You Need Part-time Staff

Small businesses might not need full-time employees for all the work they have to carry out. For example, you may need a bookkeeper to document your finances, but you might not do enough business to require someone to do that full time.

In such situations, you need a staffing agency that can help you decide if you need part-time workers and then find people willing to work for several clients. Such arrangements with staffing agencies, who also handle employee administration tasks, are usually less complicated and cost-effective than hiring someone yourself.

What Can a Recruiter Do and Not Do?

An external recruiter can save you a lot of time and money finding suitable candidates for a position. They often have networks they can tap into to reach out to candidates that might not be within your sphere. They can also make your business very attractive to applicants.

However, an external recruiter is, ultimately, not part of your company, so they might not represent the company value, vision, and culture as accurately as someone in-house can. It takes significant consultation and coordination for a recruiter to understand what you’re looking for in a prospective employer.

Unfortunately, recruiters aren’t mind readers, so there can be a disconnect between what you want and what they think you want. It also often happens that you choose the wrong recruiter to represent your company to applicants.

Some common complaints about recruiters from applicants include providing inaccurate information about the position, contacting them for irrelevant roles, and failing to get back to them after the application. Since applicants associate recruiters as a part of your company, the wrong recruiter can ruin your reputation through no fault of yours. You can avoid that by choosing the right recruiter for your hiring needs.

How Do You Choose a Recruiter?

Choosing an external recruiter or staffing agency is much like hiring an employee: you want it to be a good fit. While it doesn’t involve as much work as recruiting someone for a position, you do have to make an effort. Here are tips on how to choose the right recruiter.

Do Your Research

You can find reputable professional recruiters and hiring agencies through referrals or by searching through online directories for recruiters. While you should try to choose a few in your area for the sake of convenience, don’t let that limit your choices.

The next step is to check their websites and LinkedIn profiles to get some rudimentary information. Make sure you search for reviews of the business to get a feel of their credibility.

If the company is based in the U.S., check the Better Business Bureau (BBB) for reviews and complaints. It would be better if they’re BBB-accredited, but it’s not a deal-breaker if they’re not.

Finally, check their client list and about pages to see if they specialize in recruiting for your type of business or job vacancy. Some agencies or recruiters focus on providing clients with tech talent, while others may specialize in recruiting for the hospitality industry.

Meet With Them

While doing everything online has become a new normal, that doesn’t mean you can skip meeting with prospective recruiters before engaging their services. Even if you only do it virtually, schedule a meeting where you can ask them about their processes for finding and vetting applicants and their typical turnaround time.

Meeting with the recruiter gives you some idea of their communication style and your comfort level when talking to them. If you’re not impressed or don’t feel comfortable, move on.

Check Their References

Don’t be shy about asking for references. That is the best way for you to decide if the recruiter can do the job well, and they should be happy to provide you with a list.

A good number of recent hires and a wide variety of clients are an excellent indication of a recruiter’s expertise. Ensure you run an actual check on the references and not just take recruiters at their word.

What Should You Do Next?

The success of any business depends largely on its human resources. You cannot afford to keep a critical role vacant or put the wrong people in it. Unless you have no problems finding candidates and are ready to commit a lot of time to recruitment, you should consider paying a professional recruiter to do it for you.

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