HR Challenges for Small Businesses 2022


Tracy Givens

Feb 17, 2022


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Human Resources

It's more important than ever for small businesses to focus on employee retention. Since our employees are human beings, we need to ensure that we meet their individual needs while maintaining the needs of the company as a whole.

Here are a few examples of the biggest HR challenges for small businesses in 2022, and some possible solutions for dealing with them.

1. Change Management

Zoom video conference

Change management refers to the shift in strategy for dealing with communication in the workplace. Before the COVID-19 pandemic, it was easier to chat with a coworker face-to-face when a problem arose. With remote work on the rise and the necessity of masking, communication has become more of a challenge.

In this situation, the best defense is a good offense. Make open communication a priority in order to promote employee confidence. Schedule regular meetings, even if you need to resort to Zoom or other methods to accommodate remote workers. Taking regular surveys is a great way to gauge employee morale.

2. Talent Acquisition

Late 2021 gave rise to the "Great Resignation," as more than 4 million Americans left their positions to seek greener pastures. As you might imagine, this created a huge issue for businesses--both big and small.

The majority of these employees quit their jobs because they decided that they wanted more out of their professional lives than their current positions could offer. This means that you might have to adjust your talent acquisition strategies.

The good news? When surveyed, more than 50 percent of unemployed Americans claimed to be seeking new jobs in 2022. In order to draw from this deep well of talent, you should be prepared to meet the prospective employee's needs.

For some, that might mean offering remote work options or flexible schedules. Others might need to update their employee benefits packages or offer training that will allow workers to climb higher within the company. Having a strong team of HR professionals in place can help you achieve these goals.

Your human resources department should be responsible for recruitment, hiring, performance management, payroll, and benefits management, and--this is the key--employee retention. If you don't already have a dedicated HR department (however small), you'll need to cultivate one in order to remain relevant in the current age.

3. Developing Leaders

Speaking of additional training, it's vital for your small business to promote strong leadership. Many employees leave their jobs because a superior was unprofessional or otherwise difficult to work for.

You can circumvent this issue by identifying the workers who have leadership potential, then mentoring them so that they have the opportunity to build on their skills. Not only will this provide your company with a stronger backbone, but it will also promote employee engagement among low-level workers.

4. Retaining Employees

Did you know that it can cost up to $5,000 to hire and train a new employee? That's staggering enough for any company, but for small businesses, it can be catastrophic.

It's just as vital for your business to retain employees as it is to acquire them in the first place. To that end, you might have to offer additional incentives to prevent them from looking elsewhere.

If you can afford it, try offering an incentive bonus to employees who stay on board for a set period of time. To up the ante, offer incrementally larger bonuses the longer they stay on. For example, one bonus would be paid after six months of employment, another after one year, and so on.

5. Increasing Diversity

More than one-third of HR managers say that they've wrestled with diversity issues in the course of their work. This is a particular concern in mid-to senior-level positions.

Having a diverse workforce can benefit your company in many ways. It boosts employee morale, which can improve productivity levels. It also makes the company look more appealing to outsiders, who might then be tempted to apply themselves.

The next time you're seeking a new hire, start by connecting with a diverse job board. Your next step is to review your hiring and promotion strategies, making sure that they're fair and in compliance with labor laws.

Once the workers are on board, it's up to you to ensure that respect and equality remain a priority for your entire staff. This will create a healthier work environment even if you weren't already committed to promoting diversity.

6. Workforce Training

Workforce Training

Another challenge that's amplified for smaller companies lies in keeping up with skill training. If employees aren't offered the opportunity to develop new skills, it can be difficult for your company to remain competitive. The problem is, it's often just as difficult to train these workers without affecting productivity levels.

Adopt skills tests as part of your regular training process. This will give you a better idea of the employee's skill level and what you might do to improve it. If you don't already have a mentorship program in place, now is the time to implement one.

You can also invest in some training software that applies directly to your company's needs. Some programs might even be offered by your HRIS or PEO provider.

7. Promoting Healthy Work Culture

Even before the COVID-19 pandemic, it was natural for workers to be concerned about remaining healthy. Since then, however, workplace wellness has become a subject of paramount importance for business owners.

Having solid employee wellness programs in place will help your staff feel more secure about walking through the door. It may also help you attract new hires from the outside. What's more, it's in your own best interests to keep employees healthy, so they can show up to work regularly and be productive during their time there.

Start by encouraging a healthy work-life balance. Offering a hybrid-remote option is a good place to start. You also might seek out alternative stress reduction programs, like regular on-site massages or meditation workshops. Even fun office break room ideas like trivia games and bingo cards can work wonders when it comes to alleviating stress.

8. The Remote Option

Man working from home

Speaking of remote work, more businesses have learned that it's possible in the wake of COVID-19. In some cases, working from home can even boost employee productivity.

Younger workers, in particular, are attracted to remote work, because it allows them to achieve the work-life balance we mentioned earlier. However, for HR leaders, these options can present something of a challenge.

Before implementing a work-from-home option, ask yourself the following questions:

  1. Which positions are best suited for remote work?
  2. Which specific jobs can be done remotely?
  3. How will we provide remote workers with regular feedback and encouragement from HR departments?
  4. Will we enforce specific work hours? If so, how?
  5. Will there be any salary adjustments in place for remote workers? If so, what will they be?
  6. What technologies will we use to ensure that remote employees remain connected to the workplace?
  7. How will the remote-work option affect company culture?

Final Thoughts

There's no doubt about it: there are a number of HR challenges for small businesses 2022 and beyond. Whether your company would benefit from better leadership training, a new hybrid-remote work option, or technological updates is a question only you can answer. The upside of all this is that you can expect to come out stronger as a result of overcoming these challenges.

With the right strategies in hand, you can achieve your small business vision and ensure that the years ahead are healthy and prosperous ones--both for you and your valued employees.

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