Mark Twain said: “There are three kinds of lies: lies, damned lies, and statistics.”
When it comes to what’s happening in jobs and small business, things can get very confusing.
What’s really going on here?
Hiring is up
According to the NFIB February 2019 Jobs Report, small business job creation recently broke a 45-year record. This is very significant because two out of every three jobs in the US are created by small businesses. The report found that 57% of owners reported hiring or trying to hire workers. And 49% reported that they couldn’t find qualified workers for their openings. So hiring is up?
Hiring is down
ADP found that the hiring at small companies isn’t as rosy as the NFIB report suggests. In fact, there was a job loss in February at very small firms (1-19 employees). The jobs increase in February at other small companies (20 -49 employees) was modest at 20,000, as compared with prior recent months. The report concluded that “There was a sharp decline in small business growth as these firms continue to struggle with offering competitive wages and benefits.” So hiring is down?
A recent Clutch report on the State of Small Business Hiring and Recruitment in 2019 found that more than half of small businesses plan to hire this year, primarily for sales and marketing positions. But nearly a quarter (23%) said it’s likely they’ll fire or lay off employees in 2019.
Recently I gave a talk at a convention and asked the small business owners present whether they were hiring or trying to hire. Most of the hands in the room went up. So my anecdotal impression is that small businesses want to hire. But as the ADP report indicated, cost is an issue.
Small business owners today are citing labor costs as their most important problem, according to NFIB. Minimum wages are going up in states and cities around the country. And even without government requirements, supply and demand are pressuring higher pay and greater benefits.
For those looking to hire, factor in minimum wage requirements and consider what job applicants want.
You can check on minimum wage rates across the country at Paycor (the chart does not include higher rates that apply in localities such as New York City and Portland, OR). Note that some rates are scheduled to increase later this year (July 1; October 1).
Here’s a list of the 15 most popular employee benefits. Some of these benefits involve very little or no cost to the company:
- Flexible/remote work options
- Professional development (help to learn and grow)
- Onsite healthy snacks
- Pet-friendly offices
Whether hiring is up or down in small businesses across the country probably depends on many factors: your location, your industry, the availability of a pool of talent, and your budget. If you need to hire, you can find a solution for your situation. If you can’t find an employee who meets your needs and fits within your budget, consider outsourcing to an independent contractor, at least for a short-term solution.