Press release

Stepstone SME Report 2025: Small and medium-sized companies attract employees with geographic advantages

• 8 out of 10 employees have already applied for a job at a medium-sized company
• Employees value small and medium-sized companies because of their location, exciting tasks, flat hierarchies and family atmosphere
• Salary demands make it difficult for SMEs to attract talent

DÜSSELDORF, January 22, 2025 — According to the latest SME Report 2025 by The Stepstone Group, over 80 percent of employees have already applied to work for a small and medium-sized enterprise (SME*). The main reasons for this are the familiar corporate culture, flat hierarchies and the opportunity to have a direct influence on decisions and projects. Particularly outstanding: SMEs score points with the majority of applicants primarily due to their locations.

Location as key factor

Despite increasing competition in the labor market, SMEs are able to score points with their close-knit corporate culture and local ties.  A key advantage of SMEs lies in their local roots. 56% of respondents cited proximity to their place of residence as a decisive argument for applying to an SME employer. “The combination of proximity to the workplace and the ability to achieve a better work-life balance makes SMEs particularly attractive. This is especially true away from the major cities,” says The Stepstone Group labor market expert Dr. Tobias Zimmermann. 44% of those surveyed also stated that they see SMEs as an opportunity to achieve something meaningful and see direct results from their work. For 41%, SMEs score particularly highly with their flat hierarchies and 39% also value the informal working atmosphere, which for many is a decisive factor for well-being - aspects in which SMEs often have advantages over large corporations.

“With their approachable corporate culture, SMEs have a real unique selling point: a high degree of creative freedom, short decision-making paths and a family atmosphere create a working environment in which many employees feel particularly comfortable,” says Zimmermann.

Salary demands create biggest challenge

However, the study also highlights challenges: Every second recruiter in an SME finds it difficult to meet the salary demands of employees. And 42 percent of employees in SMEs also state that their employer's pay and benefits have fallen short of their expectations - only around a quarter of large companies say the same. Compared to large companies, however, SMEs score highly with a lower fluctuation rate. “SMEs should communicate their advantages confidently and thus strengthen their employer brand: If flexible working models, short coordination channels and innovative approaches are confidently communicated to the outside world, job seekers will recognize the advantages directly in the job advertisement,” advises Zimmermann.

More information about the SME Report here.

*SME = companies that employ up to 250 people, generate up to €50 million in annual sales and are owner-managed.

About the Stepstone SME Report 2025

In this report, the online job platform Stepstone takes a close look at the competition for qualified specialists from the perspective of small and medium-sized enterprises (SMEs) and identifies key factors that make SMEs attractive employers. In addition, Stepstone analyzes the experiences of companies as well as specialists and executives in dealing with digital technologies in SMEs and derives recommendations for action for the sustainable recruitment of qualified employees. This report is based on the results of three online surveys of specialists, managers and recruiters from small and medium-sized enterprises, each conducted in 2023 and 2024 with over 4,000 respondents (Hiring Trends Index September 2024, The Age Advantage: Recruiting without age limits July 2024, The State of Recruitment and Automation, September 2023). The surveys are representative of the working population.

About The Stepstone Group 
The Stepstone Group is a leading global digital recruitment platform that connects companies with the right talent and helps people find the right job. AI-driven job marketplaces and programmatic-powered marketing solutions connect more than 130 million job applications with around 140,000 employers every year. In 2023, The Stepstone Group generated revenue of around €1 billion. The Stepstone Group operates in more than 30 countries - including Stepstone in Germany, Appcast in the USA and Totaljobs in the UK. The company is headquartered in Düsseldorf, Germany and employs more than 3,500 people worldwide. For more information: www.thestepstonegroup.com 

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