WASHINGTON — Historically high levels of open positions continue to test small-business owners, according to the monthly jobs report released by the National Federation of Independent Business (NFIB).
The report, released on May 5, notes that while inflation is still the top business problem reported, 23% of owners said labor quality was their main concern. This is up one point from the month before. Eight percent of owners cited labor costs as their top business problem. This apprehension about labor costs as the leading business problem is at 48-year record high levels, just five points below the record set in December 2021.
“The labor force participation rate is slowly rising, which is good news for small businesses looking for workers,” says NFIB Chief Economist Bill Dunkelberg. “While wage gains have been good, inflation has outpaced it, reducing real disposable income. Small employers continue to raise wages and make business adjustments to attract qualified employees.”
A net 46% of owners reported raising compensation, seasonally adjusted, down three points from March. A net 27% of owners plan to raise compensation in the next three months, down one point from March. Both actual and planned compensation changes eased in March, but remain near record-high levels.
In addition, 47% (seasonally adjusted) of all owners reported job openings they could not fill in the current period. Forty percent of owners have openings for skilled workers, and 22% have openings for unskilled labor.
Small-business owners’ plans to fill open positions remain high, with a seasonally adjusted net 20% planning to create new jobs in the next three months. It might be challenging to fill those new positions, however. Of those owners hiring or trying to hire, 93% of owners reported few or no qualified applicants for the positions they were trying to fill, while 30% reported few qualified applicants for their open positions, and 25% reported none.
For further information gathered by the NFIB’s job report, visit its website.
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