For many small and medium-sized enterprises (SMEs) in Malaysia, competing for top talent may often feel like swimming upstream. Big names in the corporate world have long dominated the recruitment landscape, offering everything from attractive salaries to brand prestige that SMEs struggle to match. Adding to this complexity, Malaysian talent is increasingly catching the eye of international recruiters. With their multilingual abilities and strong cultural connections, Malaysians are becoming sought-after assets on the global stage. The talent crisis, therefore, isn’t about a lack of high-quality candidates, but rather a deeper issue of perception, and maybe even bias.

As SMEs face growing competition from both local and international players, the need to stand out as desirable employers is more important than ever. Fortunately, SMEs have unique strengths they can leverage to turn the tide and attract the talent they need to thrive.

Pressures and challenges facing SMEs in attracting top talent

Malaysia’s job market has become an increasingly competitive battleground, especially for small and medium-sized enterprises (SMEs). Large corporations like Petronas and Sime Darby dominate the recruitment landscape, attracting top-tier talent with not just higher salaries, but also the allure of brand prestige and career advancement opportunities. These multinational giants benefit from their global reputation, making them magnets for job seekers who equate big names with better career prospects. For SMEs, this disparity in visibility and perceived value is a significant obstacle.

In addition to competing with local corporate heavyweights, SMEs must now contend with the rise of global work mobility. According to a recent report by Jobstreet, 66% of Malaysian professionals are open to working for foreign employers without needing a physical office in Malaysia. This trend is driven by the flexibility and higher pay that remote opportunities often provide, meaning SMEs aren’t just up against local giants—they’re also vying with international firms offering remote work options. This shift makes it even harder for smaller businesses to attract and retain top talent.

Financial constraints further complicate matters. While large corporations can offer lucrative salaries and extensive benefits, SMEs often struggle to match these offers due to limited budgets. With the cost of living rising and job seekers increasingly focused on financial stability, the pay gap between SMEs and their larger competitors becomes a major deterrent.

Finally, brand perception also plays a crucial role when it comes to attracting top talent. Many job seekers view SMEs as less prestigious or less stable compared to well-established corporations. This perception can deter talented individuals from considering SMEs as viable career options, even when smaller firms offer valuable opportunities for growth, innovation, and impact.

Steps for SMEs to attract and retain top talent

1. Sell a story, not just a job

Even the smallest SMEs have the power to build a unique brand identity that stands out in a crowded job market. Unlike larger corporations, which often rely on their established reputations, SMEs can create compelling narratives around their mission, values, and vision for the future. Whether it’s a boutique startup championing sustainability or a local tech company pushing the boundaries of innovation in AI,  the ability to craft a story that resonates with potential employees is a powerful tool.

For many candidates, working for an SME offers something a larger corporation can’t—a chance to be part of a close-knit, passionate team where individual contributions directly impact the company’s journey. Position your company as more than just a workplace. Show how your brand identity is tied to making a difference, and invite potential employees to become key players in that mission. When potential employees see how their work can contribute to a larger purpose, it creates a powerful attraction.

2. Redefine your perks

While SMEs might not be able to offer the highest salaries, they can win talent by offering creative, unconventional perks. Think outside the box—wellness programs, paid passion projects, mentorship opportunities, or even “choose-your-own-benefit” schemes where employees select the perks that matter most to them. Let potential hires see that your company doesn’t just offer a job, but a tailored experience that prioritises their well-being and personal growth. 

3. Foster a healthy and happy work culture

Forget the impersonal corporate environment. SMEs thrive on creating tight-knit communities where employees are treated like family—or at the very least, like real people, not cogs in a machine.  Build an environment (whether physical or digital) where people want to come to work, with flexible policies that value work-life balance, collaborative spaces that foster innovation, and leadership that genuinely listens. Make it clear that joining your SME isn’t just about advancing a career— it’s about finding a team that supports and grows with each other every step of the way.

4. Offer purpose-driven work

Top talent today craves purpose in their work. Whether it’s championing sustainability, driving community initiatives, or solving meaningful problems within your industry, SMEs can offer roles where employees can make a tangible difference. Give them the opportunity to work on projects that align with their passions, and create clear pathways for them to see the impact of their efforts both inside and outside the company.

5. Emphasise flexibility and work-life balance

Large corporations can often feel rigid and bureaucratic, but SMEs have the agility to embrace flexibility. Promote remote work options, allow for personalised schedules, or even experiment with creative vacation policies like unlimited leave. Show candidates that your company values their autonomy and trusts them to balance their professional and personal lives. In a world where flexibility is highly sought after, SMEs can be trendsetters.

Reeling in talent

The talent crisis might seem daunting, but for SMEs, it’s also an opportunity to rewrite the rules of recruitment. Instead of competing with big corporations on their terms, SMEs can leverage their unique advantages—offering a sense of purpose, community, and flexibility that larger companies often struggle to provide.Think of it as a game of fishing, SMEs can embrace what makes them different and carve out their own niche in the talent pool. SMEs that prioritise their brand identity and invest in their people will stand out as employers of choice, ultimately driving long-term success and sustainability in a rapidly evolving market. The race for talent is far from over, and those who dare to fish differently will be the ones who land the catch.