Small business owners across the country are facing a familiar problem. That means there are a significant number of unfilled jobs. According to the latest NFIB September Jobs Report, 32% of small business owners reported having jobs they could not fill, a statistic that has remained consistent since August. This figure has not fallen below 32% since July 2020, highlighting ongoing problems for the small business sector.
Against this backdrop, the report’s findings present both challenges and opportunities for small business owners. “Main Street job vacancies remain above historical averages and owners are reporting few qualified applicants,” said Bill Dunkelberg, NFIB’s chief economist. He highlighted the ongoing economic uncertainty, suggesting that while a recession appears unlikely, small business owners continue to navigate labor imbalances that could impact growth.
Key findings from the report
- Job Creation Plan: Encouragingly, a net 16% of small business owners plan to create a new job in the next three months, the highest level of hiring intent since January. This is a one point increase from August.
- Recruitment activities: In September, 58% of small business owners were hiring or attempting to hire, up 5 points from the previous month. 88% of recruiters reported having difficulty finding qualified candidates, a 7-point increase from August.
- Skilled and unskilled labor: Of the reported openings, 28% were for skilled roles and 13% were for unskilled personnel.
The changing environment means small business owners must adapt their recruiting strategies to not only attract but retain candidates. According to the report, the percentage of small business owners who cited labor quality as their biggest challenge was 18%, down 3 points from August. However, concerns about labor costs are growing, with 11% of owners citing labor costs as their biggest problem, up 3 points from the previous month.
Compensation Trends
Compensation is an important factor in attracting talent. According to the report, wages for small business owners increased by a net 31% in September, an increase of 2 points compared to August. However, the proportion planning for future increases decreased slightly to 19%, down 1 point from the previous month. These wage pressures represent a competitive environment in which small business owners must struggle to retain and attract employees.
real impact
Armed with these insights, small business owners should prioritize innovative recruiting strategies. Here are some practical steps to consider:
- Expanding Recruitment: Explore non-traditional hiring pools, including remote workers and underrepresented communities.
- Upskill your current employees: Invest in training and development to upskill your current workforce. This can alleviate some of the burden caused by the skills gap.
- Enhanced Benefits: Flexible work hours, remote work options, and competitive benefits can attract the attention of candidates weighing their choices among a variety of opportunities.
But the challenges continue. Not being able to find quality candidates can hinder your planned business growth. Owners must be careful to balance compensation strategies while creating a workplace culture that retains talent.
Small business owners should carefully evaluate their hiring strategies in light of these trends as we head into the busy holiday season. Identifying trends in the economic environment and adapting quickly is essential to navigating a constantly changing environment.
For more information about the September jobs report and what it means, visit the full report. here. This article provides nuanced insight into the ongoing challenges and opportunities that await small business owners as they face the complexities of the current job market.
Image via NFIB
