Recently my company, Paycor, fielded a survey to leaders of small- and medium-sized businesses (SMBs). We asked how they were dealing with the pandemic and about their plans for the rest of the year. Most respondents were HR and finance leaders of companies with 100 to 250 employees. As we waited for survey results to come back, I was braced for the worst. I’m happy to report that the news wasn’t all bad. In fact, there were quite a few bright spots. So, let’s start there.
SMBs Are Down, Not Out
Most SMBs survived the early stages of the pandemic, received government funds, and are cautiously optimistic about the future.
I was personally heartened to see that more than 60% of respondents said that the pandemic had so far only had a moderate or negligible impact on their business. No doubt that’s because of government intervention: 96% of businesses that applied for government aid got it (with nearly 70% of applicants receiving funds from the Payroll Protection Program).
If you stop reading now, that could sound like a happy ending. But there is more to the story, as we’ll discuss below. But I want to linger here for a moment to savor the kind of fundamentally good news we often don’t hear about (or hear and dismiss too readily): There’s solid evidence that smaller, mid-market American companies, the ones most vulnerable to an economic downturn, had in fact weathered the first crashing wave of this particular storm.
SMBs Are Hiring
Or rather, they were planning to hire, which is an excellent first step. Fifty-four percent of respondents predicted that they’ll hire full-time positions. Another 11% planned on hiring part-time employees. Even more encouraging, we found that 58% of mid-market manufacturers (an industry widely expected to suffer a downturn) were planning to hire full-time workers.
Hiring is, of course, a wonderful sign that smaller companies remain healthy and optimistic. And while it’s true that very few in our survey anticipated exceptional growth — 78% said they expected to grow their teams by less than 10% — any amount of growth, given the circumstances, suggested a fundamental confidence.
Full-Tilt Change Management
I’m not going to label this section “the bad news,” because I don’t think change is bad or good in and of itself. Change is an opportunity. Much will depend on how HR shapes and manages the change that is here and the change that’s coming.
Work From Home Changed Everything
Here’s the biggie. In early summer, nearly half of SMBs (47%) transitioned from working primarily in the office to working primarily at home. That’s not to say we’ll spend the rest of our professional lives on Zoom. Moving forward, most business leaders (48%) anticipate a hybrid in-office/WFH model that prioritizes flexibility over mandatory physical attendance. And yet we’re all moving so fast that we don’t slow down to notice…this is an enormous cultural shift.
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The widespread adoption of working from home, or working remotely, at least as an option, could change everything, from recruiting and workforce planning to labor laws and the employee experience. Let’s take the one change that many of us are working through right now: employee productivity.
Leapfrog Your Competition
Thirty-eight percent of SMBs said they’ve seen a decrease in productivity since the start of the summer. There are many reasons for that (ask any parent who’s working from home with kids). Here’s where the “change is an opportunity” mindset comes into play. Many of the distractions and anxieties that are causing remote workers to be less productive are temporary. Kids will go back to school. Anxiety brought on by health concerns or personal finance concerns will subside. We’ll beat this thing, hopefully sooner rather than later, and life will go on.
But even before the pandemic, the World Economic Forum reported that more than half of all workers will need new job skills by 2022. HR teams faced a major upskilling challenge before a global health pandemic overturned the apple cart. Now it’s especially important to see learning and development as what it’s always been: a must-have competitive advantage.
Many organizations are not prepared for remote work. Don’t be one of them. If your company can process this change as an opportunity, you can come out ahead with a significant competitive advantage. It’s one thing to quickly stand up a virtual office and take all your calls on Zoom. It’s another thing to get an entire organization to be as productive virtually as they were in-person, and to do so consistently for the long haul.
The way forward is to invest in learning. There’s an immediate need for technical training, how to use remote work tools, how to maintain network security, how to set up your home office. But Step Two will be how to thrive, how to have really effective online meetings, and how to collaborate with coworkers online — sometimes in real time, sometimes asynchronously.