When Would Hiring A New Employee Be A Smart Move For A Small Business?


Two+ years into the COVID-19 pandemic and nearly every business worldwide has been affected by it, but for financially vulnerable small businesses, the effects are far worse. According to the study done by McKinsey&Company, 54% of small business job roles have been listed as ‘most vulnerable’ during the pandemic, and job losses could continue going through the roof. And while employees were encouraged to stay at home, small businesses had to quickly manage the transition to remote work, which eventually led to 74% of companies planning or deciding to stay remote permanently.

Although small businesses are still recuperating from the fallout, change is slowly taking shape, and small business hiring is once again an important subject. However, small businesses should be careful and get the timing right when hiring new employees. If they rush the process, their profits may decline, and their cash flow may dry up. But, if they wait too long to bring on a new employee, their commitments may outpace their capacity, and unfinished work will start to pile up. So, when would hiring a new employee be a smart move for small business owners? Let’s find out.

Create A List Of Advantages And Disadvantages

Determining whether the time is right to hire a new employee may be as simple as making a pros and cons list. This is a smart thing to do before you check your cash flow, last year’s financials, and workload. This is what the list should look like:

Advantages of Hiring a New Employee

  • You’ll have more people to help you handle the tasks that are slowly overwhelming you
  • A new employee can bring new energy to your company and generate new ideas
  • You’ll have someone to share the exciting moments (someone to high-five when things go great).

Disadvantages of Hiring a New Employee

  • New employees cost money
  • A new employee requires a big investment upfront
  • There are more tax forms to handle
  • You’ll take on more stress as another person is now depending on your business
  • You’ll have to monitor and manage the new employee.

Once you have your list and if the advantages outweigh the disadvantages, you can take another step forward, and that is, figuring out whether or not you should hire a new employee.

Should You Hire A New Worker?

There are four things to consider before deciding on hiring a new employee:

  1. What is your business vision? Ask yourself, do you really need a team or more team members, or could you do well without a temporary or permanent employee? This is where you truly need to be honest with yourself and decide if you want to keep the company where it is or do you want to make it a larger business?
  2. Where do you need extra help? Consider your workload and your project pipeline. Think if there’s anything you could delegate to a new employee, and if so, what kind of employee does this work require? Is it a marketing manager? A sales rep? Or a software engineer? Even if you aim to hire a new employee to offload work and free your time, make sure you know where that time should be spent so that you can recruit talent with the appropriate skill set.
  3. Can you properly manage employees? This is a crucial consideration. What is your previous experience in this matter? Do you have the ability to manage, and if you do, can you make a good hiring decision? Do you need professional help?
  4. Can you afford a new employee? Make sure to consider all the costs and overhead your company will incur due to a new hire. Think about wages, workers’ compensation insurance, unemployment tax, Medicare and social security taxes, employee benefits, recruitment and training costs, payroll costs, equipment, software licenses, and more. Once you have a clear idea of the potential cost of a new employee, align these costs with the benefits you’ll get from that hire. How much work will you be able to take on now that you have more help? Check your income and expenses from the previous year and determine whether you can hire a new person. If it all looks profitable, consider your cash flow and your pipeline? Can you function without being profitable in the short term, or will this harm your business?

What Are The Signs That You’re Ready To Hire?

There are several strong signs that you’re ready to take on a new employee:

1. You Are Turning Down New Work

If you have a solid roster of steady clients that you’re doing good work for but are forced to decline new opportunities to work with prospective clients, that’s a strong sign you’re understaffed. If you want to take on new work opportunities and expand your client base, you’ll likely need to recruit more people to help you manage the increased workload.

2. Your Employees Are Overworked

Too much work and stress can erode employee morale. Significant employee turnover, increased sick leave, and more employee frustration are good signs you need to lower your workers’ stress levels to help ensure they aren’t exhausting themselves with work. Talk to your employees and get a sense of how they are doing. Take stock of how the workload is handled by your team members and decide whether they need help. After all, if you want your business to succeed, you must ensure your employees are happy and healthy.

3. Customer Complaints Are Rolling In

If your employees are overwhelmed, there is a good chance they will begin to lose efficiency. If your customers start complaining about your timeliness or the quality of your work, that’s a good sign you’re spread too thin. If you cannot commit to every project, you might consider hiring a new team member. 

4. Your Revenue Stagnates

If you notice your revenue growth has slowed down or stopped, it could be because the departments driving the most revenue have reached their limits. Figure out which areas of business have the biggest impact on revenue growth, and see if you can expand your team to kickstart your earnings.

5. Experienced Employees Are Doing Low-Value Work

Do your high-value employees spend most of their time doing junior-level tasks? If such professionals are doing menial, administrative work, it’s certainly time to hire. If either you or your higher-paid employees are doing tasks that would cost less for someone else to do, seriously consider giving them to a new employee. Remember, time spent on tasks that could easily be delegated to a new hire is time you could spend on higher-level tasks that could help your business grow.


If your business has reached its limit to take on new clients and you have strong revenue growth, hiring new employees can bring lots of benefits to your workplace. Your employees will be less stressed and more focused on your work, and you can also have more time to do what you do best – leading your company towards success. 

When you decide it’s time to hire a new employee, you’ll encounter multiple steps and time-consuming tasks that are crucial to finding the right talent for your company. It’s far too easy for growing companies to miss or skip important recruiting steps. After all, you are too busy getting work done and growing the business. A professional recruiting agency can bring help to your organization and consistency to your hiring process.

Hundreds of new candidates are looking for job openings every day, and CIBR Warriors is here to help you find the right one for you. For more help in advancing your career or finding a qualified candidate in IT and Cybersecurity, contact us. We’d be happy to answer your questions and provide you with the best advice for getting started.

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