4 Ways SMEs Can Improve Benefits and Compensation To Attract Top Talent
Good news: hiring in Malaysia has returned to pre-pandemic levels. With many companies resuming normal operations, employment is likewise back to normal, even among small-to-medium enterprises (SMEs). According to JobStreet Malaysia’s 2022-2023 Outlook: Hiring, Compensation, & Benefits report, most medium-sized companies (60%) plan on increasing their permanent full-time staff in the first half of 2023. Small businesses are not far behind, as 57% intend to hire more people within the year. With hiring clearly on the rise, how can the increase in job demand impact benefits and compensation among SMEs?
In a competitive job market, SMEs must carve advantages to compete against bigger companies. Large corporations have the scale, prestige, name recall, and sometimes perception of stability that many SMEs do not have, making them more attractive to candidates. Knowing this, SMEs should be able to use benefits and compensation to at least level the playing field, if not tip the scales their way. A competitive benefits and compensation package can attract candidates. Needless to say, it can also retain, and thereby develop, talented employees.
There are many ways SMEs can improve their benefits and compensation. Based on JobStreet’s Hiring, Compensation, & Benefits report, one can see four main key points that hirers need to emphasise when trying to attract talent. Let us look at these factors and how SMEs can address them.
Salary remains one of the top considerations among jobseekers. JobStreet’s Hiring, Compensation, & Benefits report indicates that 63% of Malaysian candidates consider unsatisfactory salary a major reason for declining job offers. To stay competitive in the job market, SMEs must find ways to improve their compensation packages. With their larger revenues, bigger companies are more likely to offer higher salaries.
This is a reality that most SMEs need to accept or maybe build around. If it is not feasible for your company to increase salaries to levels that match those offered in bigger companies, there are other ways to make your job offers attractive. Remember: salary is just one aspect of work. Think of alternative methods to sweeten your package that do not necessarily translate monetarily.
Salary is not the end-all and be-all of the job market. In fact, one of the main insights from JobStreet’s Hiring, Compensation, & Benefits report is that salary is no longer the only draw for jobseekers. One noteworthy finding is that 24% of candidates cited a lack of benefits as a reason for turning down a job offer.
Jobseekers are looking for other reasons to take on a job outside of financial compensation. Benefits can come in the form of special leaves, such as marriage, study, and even compassionate leaves for special cases not covered by traditional leaves. Providing these benefits to employees shows them that you value their personal time and their lives outside of work. By adding a human element to your management style, you will be able to attract many candidates and retain current employees.
Another popular benefit many employers provide (74%) is transportation allowance for employees travelling within or outside Malaysia. Meanwhile, work phone benefits are projected to increase within the year, from 58% of total employers to 64%. The same goes for company vehicle benefits, projected to increase from 33% to 37%. These are the areas you should improve if you want to attract top talent.
3. Work-life balance
If SMEs find it hard to compete with bigger companies in compensation, they should look to bolster other factors that matter to jobseekers. One consideration becoming increasingly common to candidates these days is work-life balance. Work arrangements were in flux during the pandemic, blurring the lines between office hours and personal time on many occasions. Even as the world regains some level of normalcy with each passing year, the effects of this period of uncertainty are still felt to this day. People have now realised how important their personal time is.
Companies, no matter the size or compensation package, can be attractive to today’s typical jobseeker by offering better work-life balance than the competition. Providing flexible work arrangements is a large component of this. More and more companies recognise this as one of the major factors affecting talent acquisition and talent retention as well.
JobStreet’s Hiring, Compensation, & Benefits report shows that more employers are looking to provide flexible work hours to their personnel, from only 42% of companies currently providing this benefit to a projected 51% in 2023. Meanwhile, 23% are now open to implementing hybrid work models (combination of on-site and remote work). If SMEs want to attract top talent, they should consider riding this trend by providing the right tools for hybrid work, such as company laptops, work phones, and access to cloud storage.
Other top work-life balance benefits that companies provide and are planning on providing are a five-day workweek (81%), casual wear every day (64%), and early leave on festive days (63%). So, if you do not want to miss out on the best candidates, then these are some of the perks you should include in your job offers.
4. Career progression
Another factor that is increasingly gaining importance to many candidates, apart from salary, is career growth. Does your company foster and encourage career growth and progression? If so, you can expect to compete well, even with bigger companies. The prospect of growth and promotion can be as important as a high salary package. While bigger companies can offer higher salaries, SMEs can offer growth potential. The idea of growing with the company can be attractive to many candidates, especially those who love taking on challenges and have enough confidence to invest in themselves.
Climbing up the corporate ladder translates to a higher financial reward in the long-term. That is why many candidates are keen on joining companies with development programmes for their employees. 61% of companies are already offering some form of training programme, with an additional 12% planning to provide the same in 2023, according to JobStreet’s Hiring, Compensation, & Benefits report. Job rotation and mentoring programmes are also projected to rise this year, from 32% to 45% and 28% to 40%, respectively. Companies are clearly listening to jobseekers and employees alike and are responding accordingly by giving workers room to grow. This is one area where SMEs can stay competitive, regardless of their compensation package.
The main takeaway from JobStreet’s Hiring, Compensation, & Benefits report is that salary is no longer the singular consideration by candidates. SMEs should build their entire recruitment strategy around this fact and look at other areas outside of salary to attract talent. The Malaysian employee of today is more well-rounded than ever, prioritising work-life balance and viewing jobs from a wider, more long-term perspective. From a holistic view, SMEs have as much to offer candidates as bigger companies do.
For more insights on jobseekers and hiring trends in general, download JobStreet Malaysia’s 2022-2023 Outlook: Hiring, Compensation, & Benefits report. It can help guide you and allow you to make the most of growing opportunities in the job market as it continues its journey to recovery. Register now to JobStreet to get instant access to over 5 million talent in Malaysia via JobStreet’s Talent Search. For more expert advice and other resources to help you attract the best talent, visit the Employers Insights page.