Owners Now Benefiting from PPP loans but Layoffs Continued
Washington, D.C. (June 4, 2020) – According to NFIB’s monthly jobs report, the small business labor market weakened further in May with firms reducing employment by an average of 0.17 workers per firm. Down from April, 6% of owners reported increasing employment an average 3.3 workers per firm, and 21% reported reducing employment an average of 5.1 workers per firm (seasonally adjusted).
“Small businesses are working hard to begin the recovery process from the pandemic and move forward,” said NFIB’s Chief Economist Bill Dunkelberg. “But many owners were forced to lay off employees as economic activity declined in May.”
A seasonally adjusted net 8% plan to create new jobs, up 7 points from April. However, sales fell sharply in April and May, so this improvement may be temporary. Also seasonally adjusted, 23% of all owners reported job openings they could not fill in the current period. Generous unemployment benefits may be making it harder to fill these positions for some owners.
In May, 44% of owners reported hiring or trying to hire, down three points from last month. Of those trying to hire, 84% reported few or no “qualified” applicants for the positions they were looking to fill. Fifty-one percent of construction firms reported few or no qualified applicants and 37% cited the shortage of qualified labor as their top business problem.
Twenty percent of owners have job openings for skilled workers (down one point) and 10% have openings for unskilled labor (up two points). Nineteen percent of owners reported few or no qualified applicants for their open positions (down three points) and 18% reported none (down one point).
Due to the massive layoffs and terminations, fewer employers are raising compensation than in the previous months with a net 14% reported raising compensation (down two points and seasonally adjusted) and the lowest level since July 2013. A net 10% plan to do so in the coming months (up three points and seasonally adjusted).
Click here to view the entire NFIB Jobs Report.