Graduate training programmes and jobs with blue-chip companies are widely advertised, and well-publicised by universities. But they are not your only option. There’s a whole world of opportunities with SMEs (Small and Medium-sized Enterprises). These openings might be slightly harder to find, but they can provide equally rewarding and exciting careers. Don’t let misconceptions about career potential put you off applying…after all, that small business could be tomorrow’s Apple, Amazon, or Google (all three were started in somebody’s garage!)
In this article, we look at the many reasons why graduates should consider SMEs as a workplace, reviewing the pros and cons of small companies vs large corporates, so you can judge for yourself whether you would like to give it a shot.
And if so, find out how to get into SMEs.
Small Businesses – Big Opportunities
Importance to the economy – SMEs are big business!
Britain is a nation of small businesses, which operate in every main industry sector and make a significant contribution to the economy. The SME sector is booming: in 2018, there were 5.7 million SMEs, making up over 99% of all the businesses operating in the UK (+63 % more businesses than in 2000). 96% were micro-businesses with less than 10 people.
Employing 16.3 million people, SMEs account for 60% of all private sector employment and contribute 51% of UK turnover. They are considered to be the ‘lifeblood’ of a healthy economy, providing employment, driving growth and innovation, and developing new markets. Just think about the success of dynamic start-ups like Uber, Deliveroo, Fever Tree, Airbnb, Revolut and Monzo, which have all disrupted their respective industries.
Source: What are SMEs & why are they so important for the UK economy? – Labs
Abundance of opportunities
3/4 of graduate jobs are with SMEs, charities and the public sector.
Many SMEs are looking to expand and are offering internships, work experience or permanent jobs. Unlike the set application procedure for graduate schemes, opportunities with SMEs can pop up any time of the year – they hire whenever they need people. So you will need to be proactive and track companies that interest you.
SMEs value graduate recruits
Nearly 1/3 of SMES have hired a graduate in the last year, with similar numbers planning to hire over the next 12 months. They will always be keen to hire bright young talent, because you have plenty to offer small businesses. (Demonstrate these attributes when you apply for jobs!):
Skills: Your degree subject is generally less important than your ability to do the job and show potential to add value to the organisation. University courses and any prior work experience will provide useful transferrable skills.
Innovation: Young people bring fresh ideas and enthusiasm and are generally unphased by a fast-changing environment.
Growth: Many graduates state they want to make a difference, to have a visible impact on the business.
Productivity: University education comprises new ways of doing things, technical skills and up-to-date knowledge about the latest developments in many areas. You will also have a useful perspective on the younger market, which is particularly valuable for products and services targeted to students/young adults.
Small Companies vs Big Companies – The Pros & Cons
So, is it better to work for a small dynamic company with growth potential or a larger, more established corporate? Both have plenty to offer, so to help you decide let’s take a look at what an SME might offer that a big organisation generally does not.
The Pros
Job satisfaction
‘SME employees are the most fulfilled and loyal’ says LinkedIn.
LinkedIn’s Work Satisfaction Survey showed that SMEs have the highest levels of job satisfaction in the UK, with micro-businesses topping the pile. Key factors included ‘the opportunity to have a positive impact on others’ and ‘relationships with colleagues’.
In large organisations, at junior levels, employees can find it hard to make an impact, and may feel less valued and fulfilled.
Less hierarchy & bureaucracy
Most large corporates have a rigid hierarchical structure with many rules and regulations, resulting in a slow decision-making process, whereas smaller firms tend to be less bureaucratic with a more dynamic culture.
In SMEs you are more likely to have interaction with senior management, particularly in start-ups, where teams are often so small that you might work directly with the founders. You will have the opportunity to learn from inspirational people and your voice will be heard (which is not always the case for a junior employee in a large company).
‘Small business owners know their greatest asset is their staff and they are far more likely to treat them as individuals and recognise their needs. By having a committed and loyal work force that has a say in how the organisation is run, the smallest business has a bigger advantage.’John Wright, Federation of Small Businesses (FSB)
FSB: Employees are happiest in small businesses
Company culture
If big corporates feel faceless and intimidating, you might feel more engaged in a friendlier, more intimate work environment.
Cultural fit is always hugely important when hiring candidates, and even more so for a small workforce, where the impact of recruiting an ideal fit (or a poor match) is amplified. So if you join a small company or start-up, you can expect to be part of a team of like-minded people with shared values, working towards a common goal. You’ll have the chance to get to know colleagues well, feel that your opinions count and that your individual efforts can really make a difference. A close team can also ease the pressure of settling in, making it less daunting to ask questions and request help from co-workers.
Small companies often create a high-energy environment which makes work-life fun, encourages people to bond and creates a collaborative culture – we’ve seen all sorts of elements from office dogs, table tennis, yoga sessions and inspirational speakers, to informal drinks events designed to improve networking skills. And employees who actually look forward to Mondays!
Develop skills quickly
An SME will probably not provide a structured training programme or the level of support you would get in a big corporate. But on the other hand, with a small workforce, you are likely to benefit from hands-on experience, juggling a wider variety of responsibilities and interacting with more areas of the organisation, all of which will give you a real understanding of how the business functions. Learning on the job presents constant challenges and helps you to develop skills quickly.
Career progression
Whilst your starting salary will probably be lower than in a large company, there’s a chance to rise through the ranks faster in an SME. As an experienced headhunter points out:
‘It’s important to realise that whilst the top jobs attract the top people, some of the less well-known companies and less glamorous sectors offer great opportunities. And because they don’t necessarily attract the crème de la crème, you can progress quickly by being the best around.’Mark Swain, Director of Partnerships, Henley Business School
On a graduate scheme, you follow a set path for a couple of years, which dictates your salary and job level. But a smaller organisation is likely to give you greater responsibility sooner, with the opportunity to shine and make a visible contribution to the business, earning you the recognition you deserve. Progression and rewards can come quicker than expected, especially if the company succeeds and grows.
Equally, there’s no place to hide if you mess up! In a small workforce, a big mistake or underperformance is sure to be noticed.
Less competition
You will still have to impress to secure a job and progress in an SME, but you will face less competition and a less rigorous application process. The top grad schemes are highly sought after, and only 14% of applicants will gain a place on one of their programmes. Also, some large organisations recruit hundreds of graduates and it can be tough to make your mark and work your way up the hierarchical career ladder.
Freedom, flexibility, fluidity
If you thrive on structure and organisation, with set procedures and a clearly defined career path, you are likely to be well-suited to corporate life.
But an SME can offer a more flexible, autonomous environment: less red tape, an openness to different ways of doing things, freedom to work remotely or adapt your work schedule, scope to shape your role and create your own career opportunities rather than feeling pigeon-holed in a large organisation. Whether or not the business is growing fast, inevitably it will be ever-changing, so it’s likely your role will too.
Future career
An SME can be a valuable stepping-stone to a larger organisation, if that is the route you choose. You might not have a big brand name on your CV, but don’t underestimate the value to employers of small business experience. It suggests you are a self-starter, with initiative, ideas and an abundance of transferrable skills, alongside any technical skills and specific expertise you will have gained.
The Cons
Risk
If job security is a concern, working for a large established organisation will pose less risk. If a small company is not growing, there may be little chance for progression; and there’s a risk of unemployment if the business is struggling – new hires are often the first to be let go.
Salary & benefits
The starting salary is unlikely to be competitive with large corporates, although you may catch up through quicker career progression if you are performing well and the company is successful. Large corporates generally offer a better benefits package e.g. company car, private healthcare, good pension scheme, staff discounts etc.
Some HR processes may not be set up until a company has been established for a while, which can be challenging for employees e.g. a complaints procedure or maternity leave policy.
Mobility & growth
Large organisations often have multiple locations and divisions, giving opportunities to work abroad or relocate if desired, or even to change career direction by transferring to other departments. But with smaller numbers of employees, there could be limited opportunity for internal career moves.
Less formal training & support
Large company structured graduate schemes offer excellent training and a great kick-start to your career, and you will also benefit from working with experts in many areas of the business.
In a smaller company, training will probably be informal, as and when needed, or you may need to access certain knowledge yourself. However, what you miss out in formal training, will be compensated by plenty of practical experience, learning on the job, often alongside senior staff.
Large organisations generally have an established support network from line managers to mentors and HR, plus continued training and development opportunities.
Company reputation
Working for a reputable, big brand corporate will always help your CV.
Small or Big Company – How do You Choose?
As you can see, the thriving SME sector is well worth considering as a potential workplace. Both large corporates and small firms have plenty to offer; one area is not necessarily better than the other, but it’s important to understand the significant differences (as outlined above) and how they relate to your personality, preferences and goals.
3 steps to help you decide what type of company suits you
1. Start with you
Think about what you enjoy, the type of role you want, how you like to work, your values and career goals.
Personality traits typically suited to SMEs:
- Self-starter – you will have the chance to shine, but it’s very much down to you. So you will need to be proactive, highly engaged in the business, keen to take on responsibility and relish a challenge
- Independent thinker – questioning, analytical
- Entrepreneurial spirit – innovative, looks for creative solutions, has drive and perseverance
- Not afraid of risk, uncertainty or change
On the other hand, if you favour a more structured environment with a specific job scope and well-defined career path, which offers stability and job security, you may be better suited to working in a larger, established corporate.
2. Key motivators
Prioritise what is most important to you from a job and employer at this stage of your career.
Research* into what graduates want from their first job shows that they are more concerned where their first job will lead them than what they will earn. Whilst money and the compensation package are important, other key motivators match well with what SMEs can offer e.g. wanting to have an impact, continued learning, an environment where they can settle in and feel valued, and a good work/life balance.
So, for many graduates, the ideal first job could be with an SME rather than a large company.
*Research into what graduates want from their first job: LinkedIn, CEB Research: 10MinutesWith.com
3. Weigh up the pros & cons of any opportunities that interest you
Whether it is a big or small company, key considerations are:
- the job role
- your future – will it take you closer to your goals?
- the company culture, which can be crucial to happiness in the workplace
Ultimately, whether an environment suits you has less to do with the size of an organisation, and more about whether the culture is a good fit for your personality, values and ambitions. Try to network with people connected to the company and do your research – their products/services, website, social media, news and general behaviour will all give an insight into their culture and whether it’s right for you.
Wherever you choose to go, remember it’s not a lifetime commitment. Most people change jobs and even career direction several times. Different sizes of business may appeal at different stages of your life, and it is easy to change from one to the other, to find what suits you best.
If you would like to pursue the SME route, bear in mind that many smaller companies do not advertise their openings, so you will need a proactive approach. In the next section, we explain how to find out about small companies and access job opportunities:
