How many HR staff should a start up or small business (SSB) have per employee?

Last updated on October 27th, 2017 at 10:39 am

(I define a ‘start-up to small business (SSB), as being from from about 1 to about 30 people in size.)

The 2008 Human Capital Benchmarking Study by the Society for Human Resource Management provides some useful insight into this debate. They surveyed 5,000 organizations, and concluded that organizations which were less than 100 employee in size averaged about 2.2 FTE HR staff for every 100 employees.

table of HR ratios
Source: SHRM Human Capital Benchmarking Study (via businessmanagementdaily.com)

In my opinion, a business is never too small to have HR staff; the reason for this is that organizations containing just 1 employee face most of the same employment regulations and HR issues as large organizations. So, it is not the case that an organization of 1 does not need HR, it just has a reduced need for HR.

So, how does this work in practice? In my opinion and, in reference to the organizations that I deal with, which are primarily SSBs, I would suggest that  start-ups and small business of about 10 people would ideally have about 8 hours of HR help a week.

This could be in the form of a part-time HR employee, or a freelancer. At this smaller size, a freelancer could make more sense are they are a more flexible resource, but they may be more expensive.

If you would like any HR help or advice on a flexible freelance basis, then please do contact me.

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