Hiring Your First Employee and Keeping Him

As a small business owner, hiring your first employee can be an intimidating process. Hiring is a time-sensitive issue; if you hire your first employee too soon you could run into cash flow issues, but if you hire too late you might not be able to keep up with the demands of your business effectively. So the burning question is…

How Do You Know if You’re Ready?

There are a slew of indicators that will show whether or not you are ready to hire. If you can answer “yes” to more than one of the indicators below, then it is likely time to hire someone.

Can you meet the demands of your business?
This is an easy one, but if you’re finding yourself overwhelmed with the tasks you face every day, and are unable to keep up with your business responsibilities, then taking on an employee is a necessity. However, need and being able to are two very different things – can you answer yes to any of the following?

Are day-to-day tasks taking up all your time?
If the majority of your day is filled with administrative tasks, consider hiring someone who can handle these for you. It’s important to recognize that your greatest potential might not be met if your skills are being spent on mundane tasks, instead of on business development.

Do you need help from an expert?
Many entrepreneurs have a “I’ll do it myself” mentality, which can be crucial in the beginning stages of a business. There comes a time, however, when you will need the help of an expert, rather than trying to do it yourself. Specialties such as accounting, HR, and marketing will be best fulfilled by those who are well versed in the field.

Are you spending too much on contract help?
If you utilize contract help, such as freelance writers, you need to take a close look at how much you pay them. If you pay your contract help more than what a salary for an in-house position would require, then hiring someone would save you money and the hassle of depending on someone outside of your business.

Are you ready to grow?
Emotional readiness may seem trivial, but if you are not mentally ready to take on growth, then your relationship with your new employee could suffer greatly. If you’re excited about new growth opportunities, the chances are that you’re ready to take on a new hire. If you’re dreading the growth of your business, it’s probably best if you don’t pursue an employee.

Affording an Employee

There are many hidden costs to having an employee beyond salary. Don’t find yourself making the mistake of thinking you can afford an employee when you really can’t. Factor in employment taxes, benefits, work equipment (including computer needs), and recruiting expenses at the bare minimum (more on this below).

There are many online calculators that can help you figure out how much it costs to employ a specific person based on your location and the person’s qualifications. There are other tools that can help you generate a salary range based on your desired qualifications, location, and industry.

There are countless resources on the web for small business owners that can provide you with valuable information on the steps to take during the hiring process, including calculating whether or not you can afford an employee. For example, Simply Business is a UK company that created the below interactive infographic for small business owners who need information about the hiring process and calculating the cost of an employee. While the infographic is UK specific, the majority of information included is universal hiring steps and tips. Click to launch.

hiring infographic

Changing Perspectives

Up until hiring your first employee, your business has been yours alone. You’ve likely been handling all the business responsibilities yourself, but hiring a new employee will change that. Entrepreneurs may feel a sense of pride at having achieved a business goal on their own, and bringing in new help might cause a change in feelings.

If you’re going to hire someone new, you need to be comfortable with trusting parts of your business to someone else, and sharing in its failures and successes. The way you approach problems that arise at work will have to change—instead of trying to do everything yourself, you need to fall into a managerial role and delegate some of those tasks to your employee. If you have a tendency to micro-manage, need to do everything yourself, or can’t entrust aspects of your business to someone else, then hiring someone could be disastrous.

Emotional readiness is important as a business owner, because your initial attitude towards your employee will set the tone for your future relationship and business.

After Hiring: Keeping Them Around

If you’re very close to hiring your first employee, or have recently hired, your job isn’t over. You don’t have the luxury of hiring someone into a company with all the HR processes and company culture questions figured out. Rather, you will be constantly developing the work environment as you learn more about what having an employee is like.

If you remember but one thing, remember this: don’t forget about culture. This is super important to both employee retention and future growth. Building a culture can be difficult, as it’s more than just a vibe. It includes things like dress code, benefits, morale events, and support. So where do you start to make sure you bring on new employees into a culture they’ll want to stay in?

There are countless articles on this (no really). I won’t hash every sweet idea out, but here are some major questions to ask yourself:

  • How Will You Make Them Feel Appreciated? At the end of the day, everyone wants to feel like they are valued and contributing to a greater purpose. Consider how you will make sure they are appreciated. Will this include bonuses, private positive feedback, public praise, some rockin’ benefits? Whatever you decide, make sure you are consistent and the message is clear: you couldn’t do it without them!
  • How Will You Make Them Better? Sure, making them better at their job will help you in the long run. But what’s really great about this is you 1) give them something to work toward and 2) make them see that you are interested in their professional growth. This can span things like further education opportunities, training, even flying the whole team out to a conference for some learning and bonding. And don’t let perceived roadblocks cloud your judgement, such as “it’s inconvenient to plan” (there’s an app for that) or we can’t afford that (trust me, the ROI can be worth it). Be realistic, but also optimistic. At the end of the day though, whatever you choose, remember that anything to make your employees better is a win/win situation.
  • How Will You Facilitate Teamwork? As you grow there will always be hierarchy in one way or another, but it is up to you how siloed each team needs to be. Laying down the framework for communication is important, because as you get bigger these things tend to be shoved under the rug rather than addressed. And if I may be so biased, I’d recommend going agile, but whatever you decide make sure you have the structure in place to encourage cross-team communication.


Remember, hiring is more than just getting an extra pair of hands – it’s about efficiency and sharing your success with a team. Make sure you are both culturally, managerially and emotionally ready before taking the plunge and you will set yourself up for success.

About the Author

I #Believe in entrepreneurs.

2 Responses to “Hiring Your First Employee and Keeping Him”

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