When Is It Time To Hire Another Employee?

Time to Hire Another Employee

Most small business owners spend some time doing jobs in every department of their businesses: human resources, IT, payroll, accounting, sales, and customer service. But their time is more valuable than they realize.

To bring in more income, they must focus more on what they do best, and hire someone else to take those other duties. But before doing so, they should consider the following.


Conduct a job analysis before posting an opening

This will take a little while to finish, but it will pay off. Write down the following:

  1. What sort of tasks do you want to delegate to the new employee?
  2. Do these all fit under one department heading?
  3. Who will this person report to?
  4. What does the ideal job description look like? (The Dictionary of Occupational Titles is helpful)


How much work do you actually have?

One pitfall to avoid is over-hiring. Maybe you need a website designed so you hire a full-time IT specialist because even after the website is done, they’d be great to have around. But after the website is completed, will you have enough IT-related work to keep this person busy or challenged for 40 hours every week? If not, you’ll have an employee getting paid to do odd jobs below their pay grade while you’re spending money on salary, health insurance, employment taxes, and more. By analyzing the workload ahead of time, you might realize that you’d be better off with a contractor or outsourcing the job.


What should their qualifications be?

After analyzing the job description and the workload, you’ll know better whether you need to hire someone at entry level or someone with more experience. O*NET online is a helpful resource to determine salary levels and details on qualifications.


How much can you afford?

Job description? Workload? Qualifications? Check! Now, look at your bottom line and see what you can spend. There are many things to consider. First, you have the salary and benefits package but also take into account the time taken away from someone else to train this new hire. Will you have to purchase any new office equipment like a desk and a chair? A new computer and printer? Software? All those expenses need to be considered. Now, do you have all of that free in the budget to cover the costs? If not, let’s look a little deeper and examine how much more profit might be brought in by this person working for you. Will it free you up to be able to land a new client every month? If you can forecast a net increase in profit as a result then it might be time to hire another employee.


If you’ve gone through the steps above and gotten stuck at not having a big enough workload or not being able to afford the employee you need, you could try a part-time position or temporary/seasonal help. Whatever the route, freeing yourself from the chains of DIYing is crucial for the growth of your business.