Employer Legitimacy and Recruitment Success in Small Businesses
Williamson, Ian O., Entrepreneurship: Theory and Practice
Recruiting new employees is one of the biggest challenges facing small businesses, and a key component of organizational success. Unfortunately, existing human resource literature has almost entirely focused on medium and large firms. In addition, past recruitment research has neglected the possible influence of institutional forces on organizational recruitment success. This paper attempts to address these potential gaps in the literature by utilizing institutional theory to develop a strategic model of small business recruitment.
The ability of small firms to successfully recruit employees is consistently rated by small business owners as one of the most important factors influencing organizational success (Inc., 1997; Mehta, 1996). However, despite the fact that small businesses dominate the business landscape of the United States, representing over 99% of all employers, creating two out of every three new jobs, and producing 39% of the gross national product (SBA, 1999a), existing research on human resource (HR) recruitment has almost entirely focused on medium and large firms. Indeed, a review of all the articles published in three of the top academic journals (Academy of Management Journal, Journal of Applied Psychology, and Personnel Psychology)  from 1988 through 1998 revealed that only seven of the 207 articles that addressed recruitment, personnel selection, human resources, and hiring issues focused on small businesses or used small businesses in their sample.  Consequently, a gap may exist in our understanding of the r ecruitment issues small businesses face and what strategies are most effective.
In addition to paying little attention to small businesses, past research on personnel recruitment has neglected the role that societal factors may play in influencing the recruitment success of an organization, instead focusing on how job applicants' individual preferences affect recruitment (Brass, 1995, Barber, 1998). From this perspective, effective recruitment practices allow individuals to see congruence between individual preferences and organizational attributes. Dimensions such as recruiter characteristics (e.g., personality, knowledgeability, and credibility), recruitment message (e.g., realism, favorability, and content), and recruitment timing have received mixed support for influencing recruitment success (see Rynes & Barber, 1990, for a review). However, while clearly important, this perspective ignores the role that societal norms and values play in shaping the preferences and actions of individuals (Salancik & Pfeffer, 1978). Thus, the question of whether organizational recruitment success is influenced by how well recruitment practices coincide with the institutionalized norms of behavior existing within a population remains largely unanswered, representing a second potential gap in the extant recruitment literature (Barber, 1998). Because institutional forces have their greatest impact on newly formed or small organizations, often constraining the range of activities available to these firms (Aldrich & Auster, 1986; Stinchcombe, 1965), an understanding of the effects that societal factors may have on recruitment is particularly relevant for small businesses.
This paper attempts to address two potential gaps in the recruitment literature by utilizing institutional theory to develop a model of small business recruitment strategies. For the purposes of this paper small businesses are defined as all firms employing 500 or fewer employees, which is consistent with the standard used by the Small Business Administration (SBA) to define small businesses in most industries (SBA, 1999b). This definition encompasses both small growth-oriented and non-growth-oriented firms, since effective recruitment is important to the performance and survival of both types of organizations.
Recruitment strategies are defined as those "activities designed to either increase the number or to change the characteristics of individuals who are willing to consider applying for or accepting a job (Rynes & Barber, 1990, p. …