Think Small Businesses Don't Pay? Think Again

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  • Some people fear that working for a small business means getting stuck with lower earnings.
  • In April, hourly wage growth rose for the 11th consecutive month for small business employees.

You might get a better offer than expected.

Today's labor market is loaded with opportunities, so if you're unhappy with your job, it pays to dust off your resume and see what's out there. This especially holds true if you're less than thrilled with your paycheck.

These days, living costs are rising due to soaring inflation. If you want to earn enough money to pay your bills and have some left over for savings, you may have to apply for a role outside of your current company.

To that end, you have choices. You could look for a job at a larger employer or seek out a job at a small business. If your goal is to boost your earnings, you may be inclined to stick to the former. But actually, it's a big misconception that small businesses don't pay.

Not only do many small businesses offer generous wages, but they can also offer great benefits like flexible scheduling, paid time off, and health benefits. And in April, hourly wage growth rose for the 11th month in a row for small business employees, according to recent data from Paychex.

If you're on the fence about working for a small business, here are some potential perks to consider.

1. More upward mobility

When you work for a large company with thousands of employees, it can take years to climb the ranks. At a small business, you might get promoted from associate to manager in just a year's time if you prove yourself. That's because there won't be roughly 1,700 other people vying for that same position.

2. More responsibility

The more duties you take on at work, the better you'll be able to further your career. When you work for a large corporation, you can easily get pigeonholed into a limited series of tasks. When you work for a small business, you may have a lot more opportunities to dabble in different areas and learn new things.

3. Better benefits

Because larger companies have more resources than small businesses do, you might assume you'll find a better benefits package at a giant corporation. But actually, that may not be true.

It costs a lot of money to roll out benefits to thousands of people, and some companies may not want to spend all that. Also, some large companies are publicly traded and are ultimately accountable to their shareholders. That means they may need to be more judicious about pumping tons of financial resources into perks like gym memberships and yoga classes.

Small businesses, on the other hand, don't have those constraints. Since small businesses are typically privately held, they can spend their money as they please. And if they decide to invest in employee morale, that's their choice. Plus, if you work for a company with only a handful of employees, it may be easier for your employer to splurge on things like free lunches every Friday or on-site fitness classes.

Should you work for a small business?

You don't necessarily have to seek out a role at a small business. In fact, your goal should be to find a job that aligns well with your skills and career path. But if that role happens to be available at a smaller company, don't be too quick to write it off. You may be pleasantly surprised at how generous the compensation package is.

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