How startups compete for top talent in 2021 – Crunchbase News
As the U.S. economy heats up and a new remote working paradigm means employees expect flexible working arrangements, startups find themselves vying for the best talent in a hyper-competitive market.
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Tech companies have always been at the forefront when it comes to employee benefits and benefits (free lunch! Wellness allowances! Alcohol in the office!). But policies geared to distance mean tech workers in 2021 have more options than ever before about where to work, and that in turn means companies are handing out signing bonuses, flexible working hours and more. other advantages to compete for talents.
Popular benefits include a stipend for setting up an employee’s home office, mental health resources and flexible hours, as well as a budget for quarterly team meetings.
In technology, the board has always been “leading the pack” when it comes to attracting the best talent, Ryan Sutton of the recruiting firm Robert DemiThe tech group said in an interview.
“But now it’s a must to survive,” he said.
Employee wish list
Technicians don’t want to be told when and how to do their job. According to Nadia Vatalidis, director of personnel at Nadia Vatalidis, number one on the wish list of many applicants for tech jobs is flexible working hours and the ability to work remotely. Remote, a payroll, benefits and human resources company for distributed teams.
The new phenomenon of employees who prefer to quit their jobs rather than return to their offices has been documented. According to Sutton, many applicants for tech jobs want a clear policy on remote working, rather than a fluid policy that could change as public health guidelines change.
“The benefits don’t matter if you don’t understand the politics,” Sutton said. “And if you’re worried that the policy will be canceled in 3-6 months, when you talk about your career, a benefit for six months won’t hold you back.”
About 30 percent of jobs on a tech career company OfDice’s website qualifies remotely, which is “a long way from pre-pandemic statistics,” according to Art Zeile, CEO of Dice. Companies also offer allowances for home offices. Parent company of dice DHI Group, for example, offers employees $ 150 per quarter to spend on their remote work setup.
“I think it’s becoming more and more of a standard as a benefit,” Zeile said. “Recognize that you are going to be working more at home and we want to make sure you have the right equipment. “
But if more roles are open to remote employees, this flexibility also comes with the more delicate subject of compensation. Many companies, including Facebook, have adopted a salary scale to reflect the cost of living and the market rate for certain roles in different geographies.
And regions outside of Silicon Valley and New York have seen average tech salaries rise over the past year, according to data from Dice. Charlotte, North Carolina, and Orlando, Florida, are seeing technician salaries rise the fastest.
Gross pay is still the biggest draw for tech workers, according to Zeile, and small businesses are more likely to be location independent in pay than tech giants.
“Small businesses need to recognize that they are competing with these giants: the giants have these great advantages,” Zeile said.
As companies have started offering signing bonuses and more flexible work hours for employees, they have also had to adjust the morale benefits of remote teams.
“The biggest theme that keeps coming up is that employees and event planners want to aspire to host IRL events, but there are issues of inclusion (to consider),” said Shane Kovalsky, CEO of the startup of virtual events. Mystery.
The solution many tech companies choose is to keep most team events virtual, often using professional services like Mystery to help plan and facilitate events, but with quarterly or semi-annual in-person meetings.
Data Kruze Consulting, an accounting and consulting firm for startups, supports it.
According to Healy Jones, vice president of Kruze, startups’ travel spending is almost back to where it was in February 2020. But Airbnb spending in particular has exploded and increased more dramatically than air travel and travel and entertainment in general.
“Now that the startups think it’s safe to get together because you’re vaccinated, they’re renting an Airbnb and having a product jam session,” Jones said.
Data from Kruze Consulting shows that startup spending on Airbnb rentals more than doubled between April 2021 and May 2021.
It’s the idea of a distance selling team format shifting to technology teams, according to Zeile de Dice.
“We’re seeing companies say, ‘We’re going to connect as a team on a quarterly basis as a functional work team,” Zeile said.
Airbnb has its own program designed for team travel and bonding. And with remote employees visiting their corporate headquarters periodically, Airbnb expects more business travelers to travel together and stay together rather than in separate hotels, CEOs Brian chesky said on the company’s latest earnings conference call.
According to Kovalsky, there are basically three ways that companies have to retain their employees: their mission, their compensation and the people they work with. Changing a company’s mission and pay scale is often more difficult than helping employees get to know each other and feel connected.
When companies decided to operate remotely, “the biggest cost people saw was team cohesion,” Kovalsky said.
While morale budgets used to be more fluid, they are now something companies plan and budget for and bring in outside vendors to help them. Mystery, for example, has hosted events for tech companies, including Bandaged and Amazon.
But moving to a remote or hybrid workplace isn’t just about adjusting liaison activities and finding ways for teams to connect. There are also less fun things to consider when a business moves from employees in the same office to different states, like determining employee compensation, tax compliance measures, and health care plans.
Kruze Consulting has seen more and more startups move away from popular payroll systems like Enthusiasm in favor of professional employers’ organizations that can assist them in areas such as state compliance and choosing the appropriate health care plans. The share of companies using professional employers’ organizations for their payroll has doubled since the start of the pandemic, according to Jones.
Startups with California-centric health care plans have also found it expensive to do state add-ons, and some have started domiciling their health plans in other states, Jones said. This is just one of the hurdles of having employees in multiple states.
Illustration: Dom Guzman
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