6 Tips for Successfully Competing for Talent Against Large Companies

By Sean Loboda and Kevin Bailey

The labor market is still tight, and this has made it difficult for companies of all sizes to attract and retain staff, but for smaller companies, the challenges are magnified.

Businesses with fewer employees typically don’t have the financial resources to compete for talent directly with larger corporations in terms of traditional salary, benefits, and professional development opportunities. But some businesses with 500 or fewer employees—including fast-growing startups—have stayed competitive by getting creative with the benefits and perks they offer, and building positive workplace cultures.

As always, it’s important to keep an eye on the future when creating a plan for attracting and retaining employees. Salaries are the number-one expense for companies, followed by benefits. If you are starting with a relatively small team, you must keep in mind that despite economies of scale, those line items will grow as you add staff.

Having a vision of a future state is essential. Here are some tips to help smaller companies compete with larger companies to retain and attract employees.

How to successfully compete for talent

1. Find out what benefits and perks employees value

This is a critical step in competing for talent because no matter how large an investment you make, it won’t pay off unless you provide the benefits and perks your people value the most. Surveying staff can give you insights on how to create a package that will keep your employees happy and also give you the best return.

Keep in mind that what employees want may be a moving target, so conduct periodic surveys to keep up with their changing priorities.

2. Consider a financial wellness program

Employees have the upper hand in the labor market right now, but inflation, high fuel costs, soaring rent, etc. have many feeling stressed about their personal finances. Stress levels can impact productivity and attendance—or prompt your staff to look for higher-paying jobs.

A financial wellness program can help your business compete for talent by providing access to advisors who can assist employees as they set and meet savings goals and improve their finances.

3. Take a look at voluntary benefits

You can offer voluntary benefits, like pet insurance, protection against identity theft or legal issues, childcare benefits, etc. without incurring extra expenses since employees pay 100% of the cost. These voluntary benefits can deliver real value to your workers through group buying power and enable employees to purchase benefits at a lower rate than if they were purchasing them on their own.

4. Look for ways to increase flexibility

The ability to work from anywhere and set their own hours has become extremely important to employees, so workplace flexibility is a way smaller businesses can stand out when trying to attract and retain workers. According to a Future Forum report, 94% of employees want to set their own hours and 80% want the flexibility to work from any location.

Not every business is in a position to offer flexible hours and location, but if it’s manageable, it can give you a significant recruiting advantage. In addition, if your business can offer full-time employees a four-day workweek, that can be an incredibly attractive proposition for job candidates.

5. Be generous with PTO

Paid time off is an employer expense, but it’s a “softer” cost than items like health insurance. You lose labor hours, but depending on the nature of your business and staffing, you may have the option to increase employees’ time off for specific purposes like bereavement, childcare, elder care, or other reasons at your discretion.

Generosity with PTO lets employees know the company cares about them as people, which can give a business an edge over a company with more rigid PTO policies.

6. Check your employee demographics and tailor benefits accordingly

Surveying employees to determine what benefits and perks they value is essential to competing for talent, but it’s also a good idea to give some thought to employee demographics (age range, pay scale, region, etc.) and look for programs that may be especially appealing to the groups in your workplace. For example, companies with younger college graduates might consider programs to help pay off student loans; businesses located in urban centers can consider mass transit passes; etc.

Smaller companies can level the playing field with larger competitors through custom benefits packages and offering perks that can both attract and retain highly skilled people. A benefit doesn’t have to break the bank either—voluntary benefits or flexible work hours can be added without incurring extra expenses. And benefits like financial wellness checkups can ease employees’ financial stress.

Competing for talent takes long-term thinking

However, as a small and growing business, keep in mind that your benefits will scale as your company grows, so it’s important to have a long-term strategy in mind, rather than adding programs and perks on a piecemeal basis.

If you develop and stick to a strategy, and maximize your flexibility as a smaller employer, you can compete for talent against much larger companies—and succeed.

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