Small business staffing approaches have been consistent for many, many years. Need more help? Hire another full-time employee. Get them a desk and payroll, benefits, and do it all over again as business grows. It’s what most owners default to because it’s what they’ve done in the past.
Yet this practice is failing in uncertain economic times. Costs continue to increase—not just salaries but health insurance, payroll taxes, office space and equipment and everything else that becomes associated with hiring another employee. Yet, small businesses—especially—do not require full-time staffing needs across the board. They need coverage for busy times and assistance for certain projects or expertise that they cannot afford to have in house.
The Full-Time Employee Concept Doesn’t Work as Well Anymore
The cost of a full-time employee is so much more than the salary mentioned above.
According to payroll experts, benefits add an average of 30-40% in above base rates. Payroll taxes, workers’ compensation insurance, PTO, and administrative time spent on yet another employee—and that’s not even getting started on how much work needs to exist in the first place to warrant permanent status employment (40 hours, not 25; 52 weeks, not 38).
Thus, a $40,000 per year salary essentially renders someone a $55,000 employee by the time all is said and done—and that excludes if someone wants to offer great benefits instead of mediocre ones just to be competitive.
For small business owners operating on tight margins, this is a tough sell; therefore, let’s say they need someone for approximately 25 hours per week; to hire someone full-time would keep them at 40 with benefits, with the employer absorbing the other inequity. Yet if someone was willing to give the extra time, there would be no need to hire 40 hours’ worth.
Also, it’s inflexible; once someone is on a payroll full-time, that payment doesn’t go away due to an economic downturn or slumping sales; revenue fluctuates for small businesses; their costs shouldn’t have to similarly be fixed.
Office Space Is Expensive
Every employee needs somewhere to sit; for businesses who rent space for their operations, this means adding more square footage or putting more people in less space. Increasing commercial rent has been on the rise for most areas across the nation, rendering expansion expensive.
Thus, some small businesses realize they’re paying thousands for office space they never use—a space dedicated mainly to administrative work that doesn’t even require physical occupancy. When broken down (rent utilities furniture equipment), every workstation costs money monthly—and even if someone is sitting there every day but still spending the afternoon on conference calls for 2 hours…that’s thousands of dollars wasted.
Either way, there is no more concern over space with remote considerations but all the value of administrative support. This has made many consider whether their positions need to be in person at all; customer service; data entry; scheduling; administrative needs—all of these can be accomplished from another part of the world if set up properly without sacrificing the actual in-house functions that require in-person operations.
Administrative tasks don’t need a physical desk in most cases. Customer service, scheduling, data entry, appointment coordination – these functions work just as well from a home office as from a leased building. The technology exists to make remote work functional and secure. When owners decide to hire a dental virtual assistant or similar remote support, they get the administrative coverage they need without the space costs that come with another desk. The reality remains—with permanent offices only for those who genuinely need them and remote solutions for everything else—it’s highly cost-effective.
Hiring Takes Too Long
Good help has always been hard to find. Now it’s worse; small businesses compete with larger businesses with better pay and benefits and the longer it takes to find good candidates—the longer they remain skeleton crews.
It’s a complicated process—posting jobs, verifying resumes, interviewing candidates, following up with reference checks and final considerations—and by then, the business is down people through deadlines unmet, phones unanswered, administrative work pile-up.
For small businesses who can hardly keep up as it is with what’s already on their plates, waiting three months for help is unacceptable—everyone is frustrated and potentially lost customers could never return after such as gap in decent customer service or help—and in this day and age every dollar counts.
Turnover Costs Accumulate
People quit all the time. Whether for better opportunities elsewhere or a shift in personal circumstances or due to disinterest level in job fit—this means additional hiring needs and potential disruption of business.
When a small business has five employees at once and one decides it’s not worth it any longer—that’s 20% of your workforce gone—and those remaining have to pick up the slack while simultaneously trying to find and train someone else—which takes time that no one has.
However, remote arrangements for staffing typically have higher retention rates due in part because they service other clients; should one business see its demand lower, that worker helps out someone else instead of losing a job entirely. There’s stability for both parties.
The Expertise Gap
Sometimes small businesses need specialized expertise—bookkeeping skills—but that only amounts to ten hours worth of bookkeeping or customer service needs—in multiple languages—but only five times a year when international customers call.
To hire full-time means overpaying someone when their skills are underutilized; to go part-time means getting by with adequate skills—but not specialized—and neither side ends up happy.
The hiring of specialized assistance on as-needed bases solves this pain point—the business gets expertise when feasible but doesn’t pay the price for someone full-time—for their own billable hours are through the roof for multiple small businesses across all sectors anyway when otherwise compensated.
Flexibility Becomes Priority
Small business needs are dynamic; they change often; sometimes they require more help during certain seasons; sometimes they phase projects out entirely or need less assistance during downtimes; traditional staffing models are inflexible with transitions from what was agreed upon time and what it now required.
Yet ownership is increasingly creating situations where staffing can come in and out based on actual necessity with permanent hires made up of those employees that they know they want as part of their team—and those roles that come with specific company knowledge or require day-to-day work in-house—and offer flexible arrangements on a variable basis.
No longer are owners focused solely on how business works but rather how best business practices can function for them—with certain items needing in person nuance while others can easily be handled through proper systems communicated elsewhere . For many small businesses this means they can grow as they otherwise wouldn’t have been able through traditional staffing models.
What This Shift Looks Like
Those not doing away with employees all together are being more strategic with hiring—the traditional hires are kept as positions requiring in-person collaboration or sensitive personal dynamics/discussion—but limited—but the “looser” administrative functions that require part-time interaction but recurring opportunities find new solutions through these flexible arrangements.
This hybrid model provides small businesses with possibilities they wouldn’t typically be able to afford; thus, they maintain the stability of key employees but gain flexibility through cost-cutting remote support for other project necessity parts . It’s not one over the other—it’s what makes sense for what an owner has always done versus what’s truly needed in this moment.
This isn’t about remote work because it seems cool or because owners want to take advantage of workers; it’s about traditional formulas not working anymore due to practical situations small businesses face working in a less stabilized marketplace compared to their larger competitors which have more flexibility operating under different economic circumstances . Small business owners learn that if they adapt their formats, they can do more without as great overhead so that when opportunities arise, they’re ready without delay.
