Students find smaller companies more desirable

Bigger isn’t always better, at least for some college students.

According to a recent poll, 70 percent of college students and graduates said they would not only consider working for a small business, but that they would prefer it.

The results from the poll, which was non-scientific, were released on Feb. 22 and revealed that employer name recognition was no longer the average job hunter’s most-sought-after criteria when searching for employment. Instead, the majority of respondents said they are most interested in finding an employer that will train and invest in them, and give them opportunity for advancement. To get that, they said, they are turning to small business.

Although the definition can vary by industry, experts generally say the distinction between large and small-to-medium sized businesses is a difference of approximately 500 employees.

Collegegrad.com conducted its poll on nearly 500 students and graduates who navigated to its site in search of employment. Ranking.com, a site that tracks Internet traffic, ranks the site No. 1 in its class.

“As far as job stability, I think (large) corporations are probably more stable, and you’ll probably be paid higher wages, so you really have to be committed to a whole different set of values if you want to work for a small business in Alaska,” said Lacey Adcock, a senior marketing major.

Adcock said for her, those values include a simple passion for the work and a desire to make a difference in the community, and for that reason, she would prefer to work for a small, local business.

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Stephen Jackstadt, a professor of economics at UAA, said although pay is usually a major factor in the job hunt, having a sense of accomplishment and belonging is more important than a high salary for many people.

“Intuitively, you’d think well, it’s probably people that want a sense of belonging, that they can make a bigger impact,” Jackstadt said. “If you’re one of 500 hundred employees, you might feel like you’re more efficacious – your opinion, your views, your talents would count more (in a small firm).”

A Harris Poll released in May of 2005 examined the mindsets of employees working in small versus large corporations, which concluded with striking results. The poll indicated that 64 percent of employees at small businesses were satisfied with their jobs, compared with 54 percent working for large companies. Additionally, 38 percent of respondents working for large employers thought that their job was a “dead-end,” compared with only 24 percent of small business employees who thought the same.

The online poll was conducted on 7,718 adult U.S. workers who work at least 30 hours per week using stratified sampling and had a sampling error of plus or minus 1.5 percent.

Danielle Pratt, a senior sociology major, said she thought a smaller company would give her more job satisfaction because she wants to be able to contribute to a greater extent to the company and to the community.

And, she said, the perception of corporate greed is more of a determinant for her in finding a job than is being highly paid.

“I don’t believe in corporate domination, per se,” Pratt said. “So many of the corporations you see, like Wal-Mart, have such a greedy aspect – making money is their bottom line, and it’s not about the people.”

Jackstadt said the stereotype that major corporations are only concerned with the bottom line could be a factor fueling some students’ move toward small businesses. But, he said, watching the profit margin does in fact benefit consumers.

“Price increases for things that Wal-Mart sells are regressive, because they hurt the poor more – a bag of diapers or that kind of stuff,” Jackstadt said. “When you can cut the price of that you’re helping the poor more than you are the rich anyway, so I think paying attention to the bottom line is what businesses ought to be doing.”

In the past, U.S. employees have generally been more pervasive in small businesses than in large ones. In 2003, according to the most recent data available, there were 57 million workers employed by companies with less than 500 employees, compared with nearly 56 million in companies that employed more than 500 people, according to the U.S. Small Business Administration.

Although employment in the two sectors has for the most part been split down the middle in the past, Fortune Magazine revealed a more substantial distinction between the sectors.

Of the magazine’s “100 Best Companies to Work for in 2006,” 62 are either small or midsized, and eight of the top 10 are in that category. When ranked by average pay, nine of the top 10 are small or midsized, which challenges the notion that large companies pay better.

Indeed, a company’s appeal can be affected by the perception that its workers are not simply be another cog in the machine, said Carlos Alsua, a professor in the business administration department.

A perception of stability and prestige has often been the driving force in the past for large employers attracting workers, he said. However, he said, with many large corporations announcing major layoffs, that reputation has been tarnished.

Also, smaller and medium-sized firms tend to be younger firms, he said, which can lead employees to feel they have more of an impact on its operations because the companies are still developing.

“The research in job satisfaction shows that better benefits and better pay don’t necessarily affect satisfaction – they do affect dissatisfaction, but satisfaction is more tied to softer things like a sense of belonging, commitment to the organization, the degree to which you feel that you can make a difference,” Alsua said.