Ongoing health crisis, state regulations & slowing federal relief still pose challenges
NFIB’s latest monthly jobs report shows cause for optimism about small business. Throughout September, jobs slowly returned at many firms and small businesses prepared for further positive steps. Such signs are welcome after the damage wrought by the coronavirus pandemic and government-mandated economic shutdowns.
“Small business owners are doing all they can to keep their employees on the job and their doors open,” said Holly Wade, Executive Director of the NFIB Research Center. “However, the ongoing health crisis, state restrictions and regulations continue to slow the rebound, as does the urgent need for struggling small businesses to receive a second round of COVID-19 recovery funds.”
NFIB found that in September, 10% of small business owners increased employment. Specifically, they hired an average of 3.2 workers. While 16% of small businesses reported decreasing employment during the month, the decrease was more than covered by the increase in employment, leading to net job creation. (All numbers in the report are seasonally adjusted.)
Small businesses are also planning to hire even more workers in the coming months. A net 23% of owners plan to create new jobs in the next three months. This number is 2 points higher than it was in August and 22 points higher than April, showing the continued upward trend in hiring.
Small businesses are also raising wages to stay competitive and bring workers back. A net 23% of owners reported raising compensation in September, up 5 points from August. A net 16% plan to raise compensation in the coming months, up 2 points from August.
However, while more small businesses are hiring and raising wages, they are also finding it more difficult to fill open positions. Some 36% of all owners reported job opening that they could not fill in September, up 3 points from August. Nearly a third of small business owners have openings for skilled workers and 16% have openings for unskilled labor. Both numbers are historically high.
The lack of qualified applicants remains a major problem for small businesses. Nearly 60% of owners reported hiring or trying to hire in September, up four points from the previous month. Of those trying to hire, 89% reported few or no “qualified” applicants for the positions they were trying to fill. Sixty percent of construction firms reported few or no qualified applicants and 30% cited the shortage of qualified labor as their top business problem.
Given the continued challenges facing small business, NFIB has been working at the national and state level to ease restrictions and provide further recovery assistance. NFIB members can take action on the most important issues:
- Urge Congress to pass another coronavirus recovery bill.
- Urge Congress to stop surprise tax hikes.
- Urge Congress to stop an anti-small business mandate.
NFIB members can also download the 2020 NFIB Voter Guide, which is designed to help small business owners make the most informed election decisions for their business.