How start-ups and SMEs can attract fresh graduate talent

11 October 2022 

How start-ups and SMEs can attract fresh graduate talent by Vish Gain 

This year, the first one with a sense of normality since the pandemic started, Laffey finds herself inundated with work to ensure current students and recent graduates find placements and jobs suitable to their degrees and areas of interest. But the world of work has changed.

Remote and hybrid work have become the norm in workplaces across many sectors, perhaps most prominently in tech. Accompanying this trend is a sense of agency in the hands of fresh graduates to choose their employer according to their specific needs and sensibilities.

When Laffey graduated from university in the early 1990s, Ireland was in a very “difficult economic climate” and getting a job – any job – was the priority. Now, students are more conscious of who they choose to work for based on factors such as sustainability, human rights and general work culture.

Why SMEs?

Part of this trend is a preference among recent graduates to work in start-ups and SMEs, where they can see their efforts bear fruit in more tangible ways than if they worked for big corporations. According to Laffey, around 60pc of University of Galway students go on to work for SMEs.

“I think one of the factors is that they can see their influence really early in an SME. It’s a smaller company, they’re closer to management and they probably have faster career progression as a result,” explains Laffey, whom I first met at an Irish Universities Association (IUA) event recently.

“Particularly working for a start-up, for example, you’re closer to the commercialisation side of things that can help develop their entrepreneurial skills. It’s a great starting point if they actually want to go off and start their own business later – it’s a great training ground.”

Laffey was one of many representatives from the career's offices of Irish third-level institutions attending an IUA event on how SMEs can engage with universities. Supported by Enterprise Ireland, the event took place at TU Dublin’s Grangegorman campus.

But graduates are aware that debuting in the world of work as part of a small business may be no bed of roses. Lack of job security, lower pay and relative obscurity of SMEs when compared to multinationals were some of the issues raised by students at the event.

‘Small fish in a small pond’

Brendan Baker, head of the career's development centre at Maynooth University, thinks that these apprehensions among students mean that SMEs will have to find their unique selling point to attract fresh talent from the third-level pool when competing with bigger companies.

“A lot of students will look at the big companies and say they’re not too sure if that’s the environment for them – whether they’ll get the mentoring and support that they think they need,” Baker tells me after the event.

“Whereas SMEs can say ‘you’re going to be a small fish in a small pond’, where you’re far more likely to have access to partners, access to a mentoring programme and to be dealing with real issues. And that’s a really attractive proposition.”

But SMEs are still likely to be overshadowed by big companies on one crucial metric – salaries. With significantly more resources, both financial and otherwise, large corporations are more likely to win against SMEs when it comes to attracting young graduates looking for big bucks.

This is where the Government’s role comes in. Donal Leahy, manager of strategic policy at Enterprise Ireland, told me at the IUA event that Government-backed initiatives such as GradStart and KEEP can give start-ups and SMEs an edge over big companies when recruiting.

In Budget 2023 earlier this week, the Government announced updates to the R&D tax credits that are crucial to SMEs looking to innovate and scale in Ireland. The Knowledge Development Box, which encourages the development of intellectual property in Ireland, was extended for four additional years.

The Key Employee Engagement Programme, or KEEP, has also been extended until 31 December 2025. KEEP is a tax share option scheme that allows employees to acquire shares at a future date and at a fixed price, under specific conditions, without paying tax.

Engaging with careers services

Once SMEs find their unique proposition and avail of Government supports effectively, the next task is to actually find the fresh graduates willing to work for them. And this, Laffey and Baker agree, can only be achieved through timely engagement with universities.

“The best time for SMEs to approach us is whenever they’re ready with the offering,” explains Baker. “And if they’re not sure about that, all they need to do is drop us an email, or pick up the phone, and we will talk them through.”

Most graduate recruitment takes place from the months of October to January, with some lingering onto March, according to Baker.

“But a lot of students are sitting down with a job offer in their back pocket. So the SME needs to do its own workforce planning: When do we need this person coming in? What are the roles we want them to occupy? How are we going to recruit them? And how long will that take?”

Laffey also recommends taking part in one of the many careers workshops and societies in universities to get students engaged and make the business known in university circles. In general, getting involved early is key to success in finding the right talent.

“When I say early, I’m not talking about the academic year. SMEs need to engage with graduates early in their student journey. This can be done through, for example, internships and placements early on in their student careers,” she says.

Ultimately, having fresh graduates joining SMEs in Ireland is an excellent opportunity for mutual growth, according to Helen McMahon of Enterprise Ireland.

“A graduate is bringing an innovative, design-thinking mindset and a different way of looking at things. There’s a lot of talent to bring to an SME that they wouldn’t be able to access themselves,” says McMahon, who is a senior adviser of strategic policy at the agency.

“It’s a partnership, it’s two sides coming together, which doesn’t necessarily always happen in the graduate placement. It’s more you coming in, going through big operations, whereas this is more an opportunity for partnership in terms of development.”