Is it Time to Hire Your First Employee?
Small businesses have been growing in recent years. This results in more responsibilities and tasks that need to be done. To keep up with growth, many small businesses owners take on additional responsibilities themselves which can become increasingly difficult This means it may be time to bring in some reinforcements. But before you start your search for the perfect employee, consider the following points:
- Expenses. Can you afford an employee? Salary and benefits are ongoing costs, but you also need to factor in expenses that will be necessary to equip an employee to do the job you have in mind. This includes buying new computers, furniture and other amenities. It can also mean moving to a larger physical space. There will also be legal requirements and tax expenses, like unemployment insurance and payroll taxes to handle.
- Time spent searching and hiring. The hiring process involves writing a job description and posting it on boards or search engines. From there, you will need to search, screen, and interview candidates. This can be time consuming. Make sure you can spare that time without hurting productivity too much. Keep in mind the increased productivity you’ll gain once you get your employee in the door.
- Consultants and freelancers. It might be more cost-effective to hire a consultant or independent contractor on a project basis if your needs are not long-term. If you’re looking to grow your business organically, you’ll likely want to bring in a salaried employee to provide more consistency.
- Part-time vs. full-time. This, too, is often a cost-based decision. Part timers require less compensation, benefits and often have scheduling flexibility. However, these advantages may be offset by less loyalty and higher turnover, which could increase your training costs. Full-time employees have the potential for higher productivity, more loyalty and solid team unity. Although compensation and benefits costs are higher. Make sure you have enough work to justify paying someone 40 hours a week over the long haul.