SMEs and Graduates

Most businesses would like to benefit from an influx of talent, enthusiasm and fresh ideas. The challenge is to achieve it at an acceptable cost. One option is to employ a recent graduate. In the past, most graduate recruitment was undertaken by large companies. These, businesses of all types and sizes, including SMEs, are reaping the benefits of employing graduates.

SMEs have tended to claim that it is expensive to employ and train graduates, particularly given the risk that they will leave after training to go to a bigger firm. This has been countered to some extent by injections of European funding, especially in the more deprived areas of the UK, which has eased the financial burden for SMEs in recruiting and training staff.

Recent graduates have much to offer SMEs. They are intelligent and keen to do well:

• Most graduates are bright and well educated.
• They are likely to be ambitious and willing to work hard in order to prove themselves.
• The fact that you have offered them their first job will buy a certain amount of loyalty.

Graduates starting their first job arrive with no bad working habits:

• They have no preconceived ideas about what can and can't be done.
• You will be able to train them your way.

The Advantages for an SME Employing a Graduate

Since there may be less distinction between 'roles' in the company, a graduate working within an SME will be more likely to get involved in a wider range of activities and will gain a variety of experiences and skills:

• Motivated and intelligent graduates may have more opportunities to voice their own ideas and a greater opportunity to shape company practices and procedures.
• Graduates may have more control over their careers due to the fluid nature of their roles.
• There are more likely to be opportunities to develop roles, which would be seen as non-graduate positions in larger graduate recruiters, into career paths that necessitate higher skill levels.
• There may be greater opportunities for taking on responsibility early on and individual input will have a visible impact on the performance of the organisation.
• Working as part of a small team towards a set of shared goals can be extremely rewarding, both personally and professionally.
• Working hours are often more flexible, although flexibility will also be required from the employee.

Possible Problems for SMEs

Graduates should not be thought of as a source of cheap labour, however employing one may cause problems for the unprepared:

• Graduates may be recruited into low skill jobs within SMEs, sometimes with little or no reference to their qualifications as the graduate may choose underemployment rather than unemployment because of lack of traditional graduate level opportunities.
• SMEs may offer mainly on-the job training that is not structured in the way that many graduates would expect. Graduates must be prepared to 'hit the ground running' and not expect a fully mapped out training programme.
• Although the graduate may have more control over career progression, the lack of a formal career path may not suit everyone.
• They may expect to be given a high degree of responsibility early on.
• Starting salaries are often lower than those offered by larger graduate recruiters and benefits such as pension schemes, gym membership or company cars are likely to be reduced.
• Under UK law, SMEs with fewer than 22 employees do not have to recognise trade union affiliations among their workers.
• Once fully trained and with relevant experience, they may leave.

Attitudes of SMEs towards graduates

A review of the report Employing Graduates in SMEs: Towards a Research Agenda shows the following key findings:

• Approximately 50% of SMEs reported no preference for the degree discipline graduate recruits possess.
• Over 90% of SMEs indicated little interested in the class or type of degree
• Around 8% of SME employees have degrees, compared with over 13% of the economically active population.
• Once SMEs recruit a graduate, they are more likely to express a subsequent preference for such in the future.
• SMEs in communications and media have a high tendency to recruit graduates.