10 Recruiting Statistics Every Small Business Needs To Know in 2021

By: on May 6, 2021

With the end of the COVID-19 pandemic seemingly in sight in the U.S., recruiting and hiring is officially back on the menu for small businesses. According to a survey from The Manifest, 51% of small businesses plan to hire new employees in 2021, including 63% of those predicting revenue growth.

If you’re a recruiter or hiring manager just getting back into the recruiting game after a long hiring freeze, or simply looking to stay on top of the latest talent acquisition trends, you probably have questions:

  • What are job seekers looking for these days?
  • How can I improve my recruiting processes and the candidate experience overall?
  • Does my recruiting software stack have everything I need to win the war for talent?

To give you the answers you’re looking for, we’re highlighting 10 recruiting statistics—from Software Advice’s own research, as well as Gartner’s—that best exemplify what the recruiting and hiring landscape looks like in 2021. Use these recruiting and hiring statistics, and the accompanying tips, to get your small business recruiting function in tip-top shape.

Stat #1: Working from home is a necessity

Recruiting statistic showing that 86% of small business employees would prefer to work from home at least some of the time when the COVID-19 pandemic is over.

What this means for your small business:

While most small businesses didn’t have a choice about employees working from home due to the COVID-19 pandemic, the genie can’t be put back in the bottle. A lot of employees got their first taste of working from home this past year, experiencing the flexibility it offers, not to mention losing the tedious, unproductive commute to an office. Now, there’s no turning back.

So if you plan on again requiring employees to work at your office location 100% of the time when the pandemic is over, know that your recruiting ability will suffer because of it. Small businesses should take this time to turn whatever makeshift remote work policy they slapped together during the pandemic into a structured, long-term plan that can attract and retain talent.

Get some help here by checking out “How To Create a Remote Work Policy.” It includes a free template to get you started.

Stat #2: Going fully remote will expand your recruiting reach

Recruiting statistic showing that 49% of HR leaders plan to hire more fully remote workers when the COVID-19 pandemic is over.

What this means for your small business:

Realizing employees can maintain productivity outside of the office, many small businesses are taking the chance on hiring more fully remote workers. There’s an obvious benefit to companies that can pull it off—they can literally hire anyone from around the country, if not the world, as long as that person has an internet connection. That’s a huge competitive advantage!

Of course, there are challenges with this approach. Remote employees can suffer more from burnout, feel slighted by management for recognition and promotions, or simply be difficult to get in touch with. If you’re considering hiring more fully remote talent, managers need to be trained to ensure they can maintain remote teams successfully.

Learn why getting rid of your office altogether isn’t the craziest idea, then arm yourself with best practices for overcoming common remote work management challenges.

Stat #3: Diversity hiring is getting a technology boost

Recruiting statistic showing that 89% of HR leaders have implemented or plan to implement software tools to improve diversity and inclusion (D&I) at their company.

What this means for your small business:

Eager to make strides with their diversity and inclusion (D&I) goals, small businesses are increasingly turning to software tools that can help them land more diverse hires:

  • Job description tools such as Textio can automatically flag any biased languages in job postings to ensure small businesses aren’t accidentally alienating every diverse job seeker.
  • Sourcing tools such as Hiretual can take your job criteria—including filters for diverse candidates—and crawl online databases around the web for promising applicants.
  • Candidate assessment tools such as SeekOut have a blind hiring mode that redacts identifiable information from profiles so companies can make unbiased hiring decisions.

If you’re still struggling to meet your D&I benchmarks as an organization, consider investing in these systems, either as separate standalone tools or as part of a more comprehensive applicant tracking system (ATS).

Software can only do so much though. You should also read our comprehensive guide on how to level up your diversity hiring practices.

Stat #4: Employee referrals are a missed opportunity

Recruiting statistic showing that 0.3 is the median number of employee referrals that companies receive for every filled job requisition.

What this means for your small business:

Research has shown time and time again that employee referrals are the cream of the crop when it comes to job applicants: They have the highest applicant-to-hire rate, and they tend to stay longer at a company than any other type of candidate.

Throw in the fact that they’re cheaper to recruit than typical job seekers, and you’d think small businesses would be falling over themselves to get more employee referrals. But the stats show companies are struggling to get even one referral for every job opening.

Don’t get me wrong—turning your employees from passive workers to fiery advocates of your company to their friends and family isn’t easy. But those that are able to make it happen will reap big rewards.

We’ve done the research to learn what makes a great employee referral program tick. Get more employee referral participation with these helpful tips.

Stat #5: Passion is your way in with job seekers

Recruiting statistic showing that 39% of job seekers rank doing work they're passionate about as a top factor when considering a job, 2nd only to pay and benefits.

What this means for your small business:

With more and more job seekers prioritizing roles where they can do work they’re passionate about, small businesses need to do more work to instill that passion in their workforce. They can accomplish this in a few ways:

  • Create a compelling company mission that unites the entire workforce toward a big societal goal—ideally one tied to an issue employees care about deeply.
  • Develop career progression tracks that not only put workers in the right roles for their skills and interests, but also promises a path for promotion.
  • Expand employee recognition efforts to praise important work that may normally go unnoticed.

Is every role in your company going to spark an internal passion by itself? No. But if you can implement systems that create passion in other ways, job seekers will come calling.

Employee recognition is critical in the modern business world. Here is everything you need to know about how to handle this underappreciated facet of talent management.

Stat #6: Your EVP is everything

Recruiting statistic showing that 65% of job candidates have discontinued a hiring process due to an unattractive employment value proposition (EVP).

What this means for your small business:

Your employment value proposition (EVP) is your pitch to job seekers for why they should want to work at your company. It’s your employer brand; a summation of your perks and benefits, your company culture, who you hire, everything. And if it aligns with what job seekers want and expect, you’ve succeeded. If it doesn’t, you’re in trouble.

With job seekers having access to more resources than ever to separate EVP fact from EVP fiction (Facebook, Glassdoor, etc.), 2021 is the time to ensure that your EVP is consistent across channels, but not filled with embellishments or half-truths. If a job candidate hears one thing from you, but sees the opposite thing on social media, they’ll walk away.

Have no idea where to start with your company’s EVP? Get EVP definitions, best practices, and examples right here.

Stat #7: In-person or online? Candidates want both

Recruiting statistic showing that 41% of job seekers prefer an in-person recruiting and onboarding process, while 35% prefer a digital approach.

What this means for your small business:

If your recruitment process still takes the “my way or the highway” approach, you’re likely missing out on a ton of promising job candidates. Candidates want options that suit their preferences, and if you’re not meeting those preferences, they may get frustrated and drop out of the process entirely.

That means candidates should be able to apply to jobs through all types of channels (your company website, social media, job boards, in-person) and devices (computers, phones, tablets). They should be able to get in touch with a recruiter or hiring manager through their preferred channel as well. The goal is a seamless candidate experience for everyone.

Chatbots are great tools to learn applicant preferences and then direct them to the right channel. Recruiters aren’t using them, but they should be.

Stat #8: Automated resume screening will be critical

Recruiting statistic showing that 71% of recruiting leaders in 2020 consider automated resume screening to be of high future importance.

What this means for your small business:

Facing a flood of talent they haven’t seen in years, small businesses are overwhelmed with job applicants. The average job opening is getting four times more applications today than before the COVID-19 pandemic, and recruiters simply can’t keep up.

Automated resume screening can cut down a recruiter’s work considerably. Using keyword searches and other AI-based logic (such as comparing applications with those of current employees), automated resume screening can quickly find every qualified candidate in a stack of applications. Saving recruiters valuable time, this technology has become incredibly valuable to wade through the current labor market.

If you’re new to the world of recruiting software, we have a handy guide to get you up to speed.

Stat #9: Avoid radio silence

Recruiting statistic showing that 69% of new hires are dissatisfied with the lack of status updates they receive during the hiring process.

What this means for your small business:

While you’re busy reading applications, conducting interviews, assessing applicants, and deciding who to hire, the potential candidates themselves are waiting on an answer. And the longer they go without getting an answer, or any type of communication along the way, the more likely it is that they will accept an offer from a competitor.

Though it can be time-consuming to stay in contact with candidates throughout the hiring process, the alternative is them walking away for good. Luckily, recruiting software systems can automatically send regular notifications to job applicants to let them know where they’re at in the hiring process and any next steps they need to take on their end.

One of the most common causes of delayed hiring decisions is hiring managers. Learn how to repair your relationship with this important stakeholder.

Stat #10: Recruit skills for now and for later

Recruiting statistic showing that only 16% of new hires have the skills needed for their current and future roles.

What this means for your small business:

The ever-widening skills gap is forcing small businesses to throw everything but the kitchen sink at the problem. Besides raising wages and lowering job requirements, companies are diving deep into untapped labor markets (e.g., veterans, the formerly incarcerated) to find the skills they need to grow their business.

All that to say, if you’re not already thinking about your skills needs down the road, it’s important that you do so. Assess the gaps you have in your own organization, adjust your recruiting strategy using some of the tips above, and work with HR managers to modernize your employee training program. If workers don’t have the skills to carry your company a decade from now, the work starts today.

Forget whiteboards and classrooms—e-learning is the modern training standard for new hires, as well as seasoned employees. Learn how these tools can reduce employee skills gaps.

Looking for a recruiting software upgrade?

In 2021, the small businesses that marry best practices with the right technology are set to own recruiting in their space. The recruiting stats above will give you a jumping-off point to get your recruiting efforts to the next level.

As for the technology bit, we can help with that too. Head to our recruiting software page to compare top options, read reviews, and filter products based on your needs and budget. If you need additional guidance, schedule a call with one of our recruiting software advisors to get personalized software recommendations in minutes.

The 2020 Software Advice COVID-19 HR Impact Survey was conducted in August 2020. We surveyed 123 HR “leaders,” defined as CHROs, HR vice presidents, HR directors, HR managers, or any other role with HR leadership responsibilities at U.S.-based businesses. We worded the questions to ensure that each respondent fully understood the meaning and the topic at hand.

The 2021 Software Advice HR in the New Era Survey was conducted in January 2021. We surveyed 922 workers at small businesses with 2-500 employees in the U.S. We worded the questions to ensure that each respondent fully understood the meaning and the topic at hand.

Note: The products selected in this article are examples to show a feature in context and are not intended as endorsements or recommendations. They have been obtained from sources believed to be reliable at the time of publication.

You may also like:

What You Need to Know About Recruiting Tools, Plus 4 Top-Rated Tools

How to Level Up Your Diversity Hiring Practices

10 Onboarding Best Practices To Turn New Hires Into Lasting Employees

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