A recent report from Mineral examines issues faced by SMBs and identifies how making investments in technology can help address those obstacles.
By Maggie Mancini
As small to mid-sized businesses face pressing challenges in attracting and retaining talent, Mineral’s 2023 State of HR Report identifies places where closing key gaps in technological investment can help them address those obstacles while driving greater performance.
“There’s no question that The Great Resignation has made SMBs hyper-focused on retaining their existing employees and retaining new talent,” says Susan Anderson, chief services officer at Mineral. “As working models continue to shift and employees exercise their rights to find the best situation for them, employers should first be cognizant of the top reasons why workers decide to leave a job.”
Anderson says that compensation concerns and relationships with managers are the top two reasons for turnover. Other causes include lack of work-life balance, inflexible schedules, poor culture, and lack of growth opportunities.
SMBs can boost recruiting and retention efforts, Anderson says, by focusing on ways to address these concerns.
Retaining and engaging existing employees (87%) and attracting new talent (57%) are critical for business success, the report finds. Yet disparities between leaders’ approach to flexibility and employee desires persist.
While 80% of employees want to work for a company that values diversity, just 40% of respondents say that DEI initiatives have improved their ability to attract and retain talent, and 33% have no plans to invest in DEI.
While 81% of employees say mental health support is a major factor in their decision to take or keep a job, 73% of respondents say that mental health is either not a top priority or not a priority at all.
“The broader focus on DEI initiatives, mental health, and remote work are part of ‘employee experience’ and are intrinsically tied to a company’s culture,” says Anderson. “Because a healthy culture attracts top talent and creates and environment where employees want to stay, the most important thing an employer can do is listen to their employees’ wants and needs.”
Key findings from the report are below.
- More than half (52%) rate reskilling employees as important, yet 55% of SMBs report not having a formal training program.
- Only 14% of respondents say improving workforce analytics is a critical HR initiative, despite the significance of recruiting. Analytics tools that track employee productivity, mobility, pay, and skill level can be a meaningful way to fill recruiting and retention gaps to drive greater business performance.
- More than 80% of employees continue to work exclusively on-site, even with data showing productivity gains from remote work. This data point—along with demographics indicating that many respondents work in industries that require an on-site workforce, suggests SMBs need to explore productivity strategies beyond work location.
More than three-quarters (76%) of respondents report being optimistic about the business outlook over the next 12 months. A closer look reveals that SMBs are also struggling to modernize operations to meet 21st century challenges, particularly around enhancing HR tools related to people and productivity.
The report finds that nearly two-thirds of SMBs rely on spreadsheets and emails to manage HR initiatives. In addition, 32% of respondents use HR compliance software, even though 62% indicate they are only somewhat prepared to meet critical HR initiatives.
Less than half (49%) of respondents use automation and technology tools, including artificial intelligence, that can streamline HR operations and free up employees for more valuable tasks.
Among barriers to adopting modern HR solutions, respondents cite lack of knowledge about available technology solutions (40%), distrust in AI (36%), resistance to technology (33%), and lack of IT staff (25%).
Anderson says that the best way to bridge knowledge gaps with AI technology is to test it for the purposes companies plan to use it. Companies who want to craft their own AI proof of concept should consider a few things before they get started.
- Beware of answers that sound right. Generative AI is excellent at sounding authoritative, which makes checking for accuracy vital.
- Utilize human experts when asking questions and validating answers. Humans will provide necessary context that is important when crafting prompts for generative AI, and they will also bring that same understanding to reviewing answers.
- Be bold. Ask questions on a wide scale, from simple to complex. Watch ethical boundaries and set guidelines.
- Prioritize training your team. They should feel they are part of the process, and that generative AI is there to help them in their jobs, not replace them. The more involved they are, the better they will become at using technology, and the faster they will progress in their proficiency.
“It’s important to remember that training, like culture, starts at the top of the organization,” Anderson says. “In addition to investing in training for your employees, invest in training your managers to be good people leaders to help cultivate a strong learning culture.”