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How to Hire Employees: A Step-by-Step Guide for SMB Businesses

Reviewed by Brendan Sullivan, Indeed Recruiter
4+ years of experience, 150+ roles filled

Making a new hire can transform your business. Whether you’re hiring your first employee or adding a new member to your existing team, it’s critical to find the right match for your position and company and develop a formal hiring process that is fast, effective and legal. But creating and managing your own hiring process from scratch can be intimidating – especially without the help of a dedicated HR team.

That’s why we’ve put together this comprehensive guide to walk you through how to hire employees, from recruiting and interviewing all the way through to extending an offer and onboarding the right new hire for your business in 13 simple steps.

Signs that it may be time to hire

9 signs that it's time to hire
At smaller companies, employees often take on many roles, frequently switching from task to task and working outside their job description to keep up with business growth. Even though this ability to work across departments is a sign of flexibility, resourcefulness and drive, it can also be a clue that your employees are stretched too thin. This over-extension can eventually lead to burnout, low productivity and inefficiencies in your business.

To keep your business growing and maintain high employee morale, watch out for the following signs that it’s time to grow your team:

  • High employee turnover rate
  • Unusual spikes in customer complaints
  • Rise in overtime costs
  • Frequently falling short of goals
  • Regularly needing to extend deadlines
  • Inability to take on new projects or clients
  • Need for specialized skills
  • You haven’t taken time off in months

Benefits of expanding your team

Hiring employees offers unrivaled opportunities for growing your company’s revenue, capacity and brand recognition. The right new hire can also:

Take your business to the next level

A new employee can bring skills that take years to develop, allowing you to pursue new revenue streams, fill your company’s skills gaps and drive rapid growth with just one hire.

Free up time for you to focus on key objectives

Hiring a new employee gives you the opportunity to offload tasks and increase your bandwidth, boosting productivity and freeing up time for you and your team members to focus on what’s important.

Bring inspiration and perspective

Employees who bring new ideas and a forward-thinking approach can inject creativity and innovation into your business, helping you make critical process improvements, recognize new opportunities and help the team see things from a new perspective to stimulate advancement and growth.

Ready to get started?

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Ready to get started?

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    How to make the perfect hire in 13 simple steps

    Illustration of people shaking hands. Text reads "Hiring for your business: Write a clear job title and description, review applications and interview candidates, evaluate your choices, say hello to your new hire!"

    1. Do your research

    Prepare to recruit by looking at similar job descriptions and scanning resumes of qualified candidates to understand what skills and experience are required for roles like yours. Monitor job trends in your area and industry to identify the most popular job titles and keywords job candidates are searching for, and compare salaries to determine the right compensation level for your role. To help lay the groundwork for writing a competitive job posting, come up with a list of the key job duties your new employee will be responsible for and think about the characteristics your ideal candidate will have.

    Read more: Roles and Responsibilities Template (With 3 Samples)

    2. Choose a highly-clickable job title

    Post a free job on Indeed using a clear, concise job title that will rank high in search results and attract qualified candidates¹. Avoid buzzwords like “wizard,”“rockstar,” or “ninja,” since candidates are not likely to search for a job using those terms. Instead, pick a standard job title that job seekers are searching for. For example, a descriptive title like “Full Stack Software Developer“ will appear in more search results than “Software Guru” or “Full Stack Wizard.”

    Pro-tip: Job titles with 80 characters or less receive typically more clicks on Indeed.

    3. Create a standout job description

    To compete with bigger companies, follow best practices for clear, meaningful job descriptions. Think about what your ideal candidate is likely to search for, and include these popular keywords into your description for maximum visibility. Include accurate descriptions of the job’s responsibilities, requirements and benefits/rewards to encourage the right candidates to apply, and keep the tone conversational, informational and friendly. Check out our job description examples to help you create your own compelling job posting.

    Pro-tip: Consider posting a Sponsored Job for better visibility, and immediate access to quality candidates you can invite to apply. 

    4. Review applicant resumes

    When you have several applicants rolling in, it’s time to start narrowing down your candidate pool based on their resumes. Filter out applicants who don’t match the key job requirements by sending them a rejection email (Indeed has a built-in rejection message you can send with the click of a button!).

    To determine which resumes should be added to your “yes” or “maybe” piles, look for the following clues that tell a story about the candidate’s skill, motivations, experience and work style:

    • Quantitative evidence of a candidate’s past achievements
    • Longevity at past roles, although “job-hopping” may be common depending on the industry
    • Clear career progression
    • Attention to detail (is the resume riddled with grammar and spelling mistakes?)
    • Skills and experience that are tailored to the job description

    After reviewing resumes, communicate with your top candidates to learn more about their qualifications. This will help you create a short list of the best candidates and decide who should move forward in the hiring process. You can send emails to learn more about your candidates’ experience, or start scheduling phone screens and interviews. 

    Read more: How to Read an Applicant Resume: Resume Review Tips

    5. Interview your top candidates

    When interviewing candidates, start with a quick 15 to 30-minute phone screen to find out if they meet the basic job description and to determine if there is a mutual fit. Then, invite at least three of your most promising candidates to an in-person interview. Ask strategic questions that reveal their skills and qualifications, important personality traits and level of enthusiasm for the role and company.

    The Equal Employment Opportunity Commission’s best practices for employers details how to prevent discrimination in the interview process by avoiding certain topics, like age, race, marital status, etc. Here are some general questions that are typically appropriate to ask for any position:

    • Tell me about yourself.
    • Why are you interested in this position/company?
    • What are your strengths/weaknesses?
    • What professional achievement are you most proud of?
    • Describe your ideal work environment.

    For help tailoring your questions to the position you’re hiring for, explore our list of interview question examples, along with job and industry specific questions you can ask to find the right hire for your business.

    Pro-tip: Take notes immediately after each interview so you’ll remember the strengths and weaknesses of each candidate more clearly when it’s time to make your final hiring decision. Use an interview scoring rubric to more objectively evaluate candidates.

    6. Check references

    Checking references is a great way to gain additional insights, verify skills and ensure that you’re hiring employees who are being honest about their work experience and qualifications. Request at least three references from your top candidates and give them a quick call.

    Consider asking your candidate’s references three to five of the following questions:

    • Can you confirm the candidate’s job title, responsibilities, start and end dates, etc.?
    • How long have you known/worked with the candidate?
    • Tell me about what it’s like to work with the candidate.
    • Why did they leave the position?
    • What are their biggest strengths and weaknesses?


    7. Keep your recruitment efforts organized

    When you’re hiring for multiple roles or have dozens of applicants applying for a single position at your company, things can get overwhelming quickly. Organize your recruitment efforts and keep track of interesting candidates as they move through your hiring process by using candidate statuses (New, Reviewed, Phone Screened, Rejected, etc.) and maintaining accurate, detailed notes of each of your candidate’s strengths and weaknesses. 

    8. Choose your top candidate

    When you have multiple candidates that you think would be a great fit, choosing the right person can be difficult. To make a decision, reflect on what you learned about your candidates’ skills, personality and experience from their resumes, interviews and references. Consider how your candidates will add to your team and company culture, and compare notes with anyone else who was involved in the hiring process. It’s important to think about what your business needs and choose the candidate who will help you achieve your goals.

    Read more: Employee Selection Process: 9 Steps to Your Next Hire

    9. Make an offer of employment

    When you’ve selected your top candidate, it’s time to extend a job offer. Before sending the official offer letter, email the candidate to set up a time to talk over the phone. During the call, express excitement about inviting them to join your team and present the terms of your offer, including salary, benefits, start date, etc. If the candidate accepts your verbal offer, send an official written letter. Your offer letter should cover everything you talked about during the phone call.

    Check out our resources for writing an engaging, informative job offer letter:

    Important: Consider having a legal professional review your offer letter before sending it out.

    10. Notify rejected candidates as soon as possible

    According to a 2019 Indeed survey, 77% of candidates would have a negative perception of a company if they didn’t hear back after applying.² To avoid burning bridges, notify your rejected candidates as soon as you know they aren’t the right fit. For candidates that have reached this far in the process, deliver a prompt, personalized rejection over the phone. Be honest but supportive by giving constructive feedback to help them understand why they were rejected, and wishing them luck with their job search.

    11. Handle your legal obligations

    When hiring an employee, there are a variety of legal requirements you must meet to comply with federal and state labor laws, especially if this is your first hire. While it’s always best to get in touch with a legal professional for more advanced help navigating legal aspects of the hiring process, here is a quick rundown of what you may need to do.

    If this is your first hire:

    • Get an Employer Identification Number (EIN) by applying on the IRS website (you’ll get your number immediately after applying!).
    • Register with your state’s labor department.
    • Fill out paperwork to withhold federal taxes from your employee’s wages.
    • Set up workers’ compensation insurance if it is required in your state.

    For every full-time hire you make:

    • Run a background check once your candidate has accepted your offer.
    • Have your new employee fill out Form I-9 to verify their eligibility to work in the United States.
    • Have them sign Form W-4 to withhold the right amount of income tax from their paycheck.
    • Report your new hire to your state’s reporting agency within 20 days.


    12. Refine your new hire onboarding process

    A great onboarding process not only makes your new employee feel welcome, but also helps lay the foundation for a loyal, productive employee and sets them up for success in their new role. On your employee’s first day, give them a tour of the building, show them to their dedicated workspace and provide them with details about building access, email login information, tools they’ll need, etc.

    Consider these other tips when creating a memorable onboarding process:

    • Set up a team lunch for the first day (or first week) so that everyone on the team can get to know each other.
    • Provide the new employee with a free bag of branded items, like a pen, t-shirt, mug, etc. to help them feel connected to your brand.
    • Connect the new employee with a mentor who can help them transition into their new role.

    13. Measure your success

    Track your results to hold your recruitment tools accountable and make sure your hiring investments are paying off. To find out how your job postings are performing, generate a performance report from your Indeed dashboard. This report includes the number of views, clicks and applies your jobs are receiving, and can help you improve future job listings, identify the most clickable keywords for your job descriptions and get your job posts into more search results.

    ¹Free job posting offer does not apply to job sites, all staffing agencies or certain other types of jobs at Indeed’s discretion. Terms, conditions, quality standards and usage limits apply.
    ²Indeed survey, n=750

    Brendan Sullivan is an Indeed recruiter based in Austin, TX with 4+ years of experience. You can usually find him enjoying one of the several amazing coffee shops in Austin or organizing his record collection.

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