How small businesses can jumpstart their recovery and overcome skill shortages

Businesses and industries across Australia face a significant skills shortage. The so-called “Great Resignation” is hitting Australian shores and 38 per cent of workers are expected to leave their current employers in the next year and small businesses are not immune to this challenge. Hiring and employee retention will one of the keys to growth and prosperity in post-pandemic Australia.

Australia’s tenacious, resilient, and dynamic small businesses community have adapted many times over the last 18 months but now face a new challenge. Staff shortages are real, but there are ways small businesses can attract and retain staff and focus on growth again in 2022. 

Put employees first

Companies expect loyalty from their employees, but often forget that it is a reciprocal value, they will earn the loyalty of their employees when they extend it first. The pandemic was a good test of how companies demonstrated their loyalty. Many companies underwent severe hardships to avoid laying off any staff. Many extended support when public services looked inadequate and vulnerable. Actions speak and employees recall them.

Find ways to reskill

Reskilling employees can drive recovery and expansion of small businesses. To overcome employee attrition, small businesses must consider ways to train and upskill employees. The cost of replacing an individual employee can range from one half to two times annual salary. For a 100-person organisation with an average salary of $50,000, this results in turnover and replacement costs of between $660,000 to $2.6 million per year. Besides, turnover can hurt continuity and culture.

Reskilling is a smaller investment than new hiring. Through training and upskilling, small businesses can build a more well-rounded, cross-trained, and efficient workforce. Reskilling internally allows business owners to take control of their resources and better utilise and empower their existing team.

Let’s say your business is in retail and you’re struggling to find a retail manager. Look internally. Your employees already have a sound understanding of your business, its processes, and its broader mission. By providing additional training such as marketing, inventory management, and people management, your business can fill in the skill gaps and create opportunities within. Training and reskilling can be both formal and informal. Integrating a learning system, similar to Zoho’s Learning Management System, will simplify the process of ongoing skills enhancement.

Look for ways to motivate people

Employees are attracted to companies that invest in career development. Training and upskilling is one important way of demonstrating this commitment. Upskilling employees also has a compelling by-product: boosting morale, motivation and confidence within a business. It creates growth and advancement opportunities for employees who are now less likely to leave.

At the core of any small business is customer relationships and experience. Happy and satisfied employees often provide better service, which contributes to more satisfied customers. In highly competitive industries, motivated employees are the sole source of competitive differentiation. There are a few better ways to drive motivation than taking care of employees and investing in their growth and development.