Entrepreneurs using non-monetary incentives and perks, including reward programs to attract the underemployed, have a much better chance of succeeding than those who are not.
A guest post by Dr. Jeffrey R. Cornwall in the Christian Science Monitor explains what the underemployment rate is, and why “all entrepreneurs should be paying attention to [it].”
The underemployment rate is tracked by Gallop and reflects the combination of those unemployed and part-time workers who want to work full-time. The current underemployment rate is more than 19 percent, while the unemployment rate is approximately 10 percent.
According to Cornwall, when the economy is flourishing, big business has all the advantages needed to attract talent. But, during today’s job market small businesses have a fighting chance in acquiring new workers. Taking advantage of non-salary benefits and rewards allows the entrepreneur to offer “more non-traditional compensation.”
Non-traditional compensation may include:
-Creative bonus plans
-Profit sharing options
-Stock and/or stock options
-Stock appreciation rights plan
“Small businesses have more flexibility in how they structure compensation. To leverage this, entrepreneurs should listen to what the employee really wants. There may be opportunity to meet their needs in ways that do not cost money,” notes Cornwall.
Benefits small businesses may offer to entice new talent are: to offer flexible hours, time off, and tailor “plans to meet the unique needs of each prospect”. To find employees, Cornwall suggests using social networking sites; they are proving to be a very effective means of connecting.
Cornwall is the Jack C. Massey Chair in Entrepreneurship and Director of the Center for Entrepreneurship at Belmont University in Nashville, Tennessee.