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Small and Medium Businesses (SMBs) are the preference when it comes to looking for jobs in India, making startup culture a sought after work environment for Indian job seekers. Findings from a recent study by the job site, Indeed, revealed that 72% of job seekers in India prefer SMBs over large enterprises.

The main reason cited by the survey includes challenging job roles (73%) at small businesses and scope for innovation and learning (67%).

The main reason cited by the survey includes challenging job roles (73%) at small businesses and scope for innovation and learning (67%)

However, jobseekers are also aware that working at small businesses could mean they have to let go of a few things. For example, 44% of job seekers surveyed feel SMBs offer low salaries, inadequate benefits and perks (32%), and have limited resources (31%). Despite this, jobseekers feel that SMBs offer a faster growth curve and a dynamic learning environment, compared to larger companies.

Hiring Disparity in the SMB Sector

Despite the positive sentiment from jobseekers, SMBs are struggling to capture the right talent. SMB hiring practices are focused on referrals and family connections, because of which they have lost out on a large pool of skilled talent.

This is evident from the study which shows that 74% of SMBs preferred hiring through personal or known references because it is easier or quicker to hire a candidate from within the family or through connections. These hiring practices have pushed SMBs to underscore the importance of a skilled workforce as 60% of SMBs have highlighted that there is a close to 40% skill gap in their organizations.

It’s evident that job seekers are focused on SMBs which means that they need to lay the foundation for strong HR practices and realize the value of hiring right to flourish and contribute to India’s growing economy

However, in contrast, a huge portion of jobseekers (67%) prefer finding jobs through democratic job sites or portals as it gives them more access and freedom to choose from a host of job opportunities. This indicates the hiring disparity between SMBs and job seekers.

The major reason for this is the fact that SMBs do not have the time or resources to spend on hiring. Many SMBs are micro-SMBs and don’t have dedicated hiring partners with 33% of them indicating this as a challenge.

Sashi Kumar, Head of Sales, Indeed India said, “Today’s SMBs are facing increased competition for talent, especially from large players. They are struggling to find the right fit candidates and are wary of the impact hiring delays will have on their business.

“However, it’s evident that job seekers are focused on SMBs which means that they need to lay the foundation for strong HR practices and realize the value of hiring right to flourish and contribute to India’s growing economy. SMBs are expected to create 2 million jobs in the next 5 years and hence SMBs must adopt democratic hiring practices that allow them to create a more diverse talent pool.”

Tob SMB job roles, cities and sectors

Top job roles preferred by jobseekers % of jobseekers
Software developer 49%
Field sales executive 46%
Front desk executive 41%
Customer relationship manager 36%
HR associate/executive 32%

According to the study, top cities where job seekers are highly attracted to SMBs include Bangalore and Mumbai (83% each), Chennai (75%), Hyderabad (71%), and Kolkata (69%). In terms of sector preference, IT (39%) leads, followed by hospitality and food (24%) and e-commerce (23%).

With the accelerated digitisation, Indian SMBs are at a crucial phase of growth where they will be competing against large enterprises and need to unlock their true potential by leveraging technology in hiring.

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