Online recruitment - a valid solution for the SME? - 10/2001

Small and medium sized enterprises (SMEs) are all stressed out. SME owners and employees work long hours, work weekends to catch up, donít feel they use time at work efficientlyÖ and itís getting worse.

One third of SME owners and managers now work almost double the European Working Time Directive standard 35 hours a week. A recent survey by British Gas shows that non-core activities like administration and statutory financial requirements are taking up a third of SME ownersí time. Even worse, a staggering 18% of SME owners are working for more than 70 hours every week.

This kind of work pressure is having a predictable effect on the work/life balance. More than half of SME owners and staff catch up with work over the weekend or work late during the week, and 50% suffer from stress or feel that their home life is suffering.* At the same time, a significant proportion of SME managers are concerned that pressurised working practices are exposing staff to stress and exhaustion.

This is bad news for SME owner/managers, but it is also bad news for the economy in general. SMEs form a crucial part of the UK economy. They represent more than 90% of the overall business community* and are a breeding ground for creativity and innovation.

Clearly, time pressures and stress in the SME sector are significant problems. The solution could lie in finding trusted business partners to relieve some of the pressure of non-core activities.

The cost of recruitment
Research indicates that recruitment can take up to 20% of a managerís day* Writing advertisements, placing them in newspapers, waiting for hours on the phone to newspapersÖit takes a significant amount of time. Giles Bretherton, owner of a small catering company in Leeds, said: ìWhen weíre recruiting it adds hours to my day. All the small business owners I know work more than ten hours a day ñ so having to organise advertising on top of that really becomes exhausting.î
And itís not only time consuming ñ recruiting can be expensive, especially when youíre competing for the best talent against larger companies. Often SMEs need to place advertisements in national newspapers and, although costs vary depending on the publication, position, date, repeat deals and section of the paper, itís not out of the question to spend 6,000 on a single advertisement that runs for just one day.

Using a recruitment consultancy is also expensive. For a middle management job, with a salary between 30,000 to 45,000, the cost to the SME is 20%. For a 35,000 job, thatís 7,000 ñ a considerable amount of money, especially for SMEs.

SMEs also encounter problems because they lack brand recognition, so letters of enquiry are not as common as they may be for companies with high profiles. Where a company like Goldman Sachs, Lloyds or John Lewis might get hundreds of letters a week from people enquiring about vacancies, a SME is unlikely to get one.

Do it on the web
One solution for SMEs seeking to ease their workload and reduce costs is online recruitment. Online recruitment companies act as a high-profile brand name brokers, introducing SMEs to potential recruits. ìI would never have thought to write to smaller companies and ask about positions,î said Claire Ingle, real estate agent, ìBut I saw an advertisement on an online recruitment site, and it turned out to be from a boutique estate agency. Iíve been here for over a year now.î

Online recruitment is also cost effective. Traditionally, employers have had to be members of online recruitment companies to place advertisements ñ meaning costs were still quite high for a company only placing a few advertisements every two or three months. Recently, though, progressive online recruiters have recognised the gap in the market for SMEs ñ and are offering single advertisement posting rates customised to suit the needs of the smaller business.

Instant access to more candidates
Using the Internet also has the benefit of being easy and instantaneous. Unlike newspapers, there is no deadline for copy ñ and employers can post advertisements 24 hours a day, seven days a week. The online recruitment websites are user-friendly and would-be job advertisers donít need an in-depth knowledge of the Internet to post an advertisement ñ just a keyboard and a credit card.

Jobseekers are, more than ever before, using the Internet to find job vacancies and look for information on potential employers. This very publication recently reported that job boards are the second most popular way of looking for a job, just behind recruitment consultancies. Half of the 162 jobseekers surveyed had applied for a job online before, either on a corporate site or a job board.

Online recruitment sites attract jobseekers by offering value-added services. As well as listing positions and allowing jobseekers to search through them, they help candidates to create resumes online, give career advice and offer networking and work/life balance advice forums. As a result, jobseekers use the Internet as a research and information tool as well as a place to actually apply for jobs.

In the current climate, finding cost efficiencies and time saving techniques are more important to SMEs than ever before. Owner/managers are taking every opportunity to be more competitive, but those who have not considered online recruitment are missing a trick. It provides an opportunity to compete with the top brands for the best people, to save money and time, and increase productivity and competitiveness.

* British Gas TIME Survey, 2000

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