The great resignation is a great opportunity in disguise for small businesses and startups to compete with large organisations for talent.
Small businesses have to match the cradle-to-grave benefits offered by enterprises and multinationals.
Salary increment in small companies is being projected to grow from an actual average of 15.7% in 2021 to a projected average of 16.9% in 2022, as per Aon’s India Salary Increase Survey 2021-22.
While startups score well in terms of salary hikes and promotion, the rate of attrition remains higher. Additionally, many family-run businesses and mature MSMEs following traditional work models are not well-equipped to experiment with new ways of compensating and retaining employees.
Small businesses will have to go a step further - they may very well have to anticipate how the employee context, priorities and preferences would evolve in the shorter and longer time horizons, and design their salary and benefits offerings that are potentially ahead of that evolution curve and impact the business growth.
What are the new ways in which small businesses and fast-growing organisations can compensate, reward, recognise and retain employees?
“A lot of companies are getting funding from different sources and are hellbent on becoming a unicorn. Companies that promise to show this kind of potential are offering ESOPs that promise a great benefit in the future for the employees," said Vijay Yalamanchili, CEO, Keka.
“SMEs and startups have the added advantage of saving costs with partial offline operations. The costs can be utilised to build holistic remote capabilities. Effective use of virtual tools and technology can help manage resources and be a boon for business continuity irrespective of physical boundaries," Vikas Singhania, CEO, TradeSmart, added.
Here are some new additions these organisations need to make in their compensation and benefits strategy:
- Small businesses need to increase the pool of health benefits including insurance policies and medical benefits. In addition, flexible work schedules and retirement benefits will also make space in the benefits portfolio of companies as the talent pool in MSMEs gets more diverse.
- ESOPs have become a popular way for startups to incentivise workers making them feel co-owners of the business vision and also enabling them to have a better long-term financial well-being.
- Tap into a diverse talent pool by introducing paternity leaves, adoption and surrogacy leaves, making medical insurance and other workplace benefits accessible to same-sex partners, and offering disability insurance, among others.
- Budget counseling services and student loan repayment programs, which have become even more critical in the post-pandemic world.
In the new groundbreaking eBook, Small Companies, Mega Possibilities: Reimagining Compensation & Benefits for Small Businesses, our exclusive resource will help you:
- Identify emerging trends in compensation & benefits planning
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- Discover new ways to compensate, reward, recognise and retain talent
Download your copy and elevate your salary and benefits offerings for your next phase of growth.