A report from the National Federation of Independent Business (NFIB) found that small businesses across the country continue to raise wages to keep employees and fill a historically high level of job openings, but are still struggling to fill jobs.
Nearly half or 49% of owners reported job openings they could not fill, down just one point from June and two points from May’s 48-year record high, suggesting the labor shortage remains frustrating for many small business owners as they confront inflation and other economic headwinds.
Twenty-one percent of owners said that labor quality was their top business problem, down two points from June, while 9% said labor costs were their top business problem.
Overall, 64% of owners reported hiring or trying to hire in July. Of those trying to hire, 91% of owners reported few or no qualified applicants for their jobs. To keep employees, 48% of business owners reported raising compensation, just two points below the 48-year record high set in January.
Forty-two percent of owners have openings for skilled workers and 21% have openings for unskilled labor. Sixty percent of the job openings in construction were for skilled workers and 67% of construction firms reported few or no qualified applicants.
“According to the latest JOLTS report, there are about 1.8 jobs available for every job seeker, and small businesses are feeling those shortages acutely. The only way for small businesses to recruit more workers is to raise wages, but they are faced with inflation that is cutting into their margins, which may not allow them to hire the workers they need to operate at full capacity,” stated Caleb Silver, Editor-in-Chief of Investopedia.