Small businesses are having trouble filling job openings, so some wages are rising
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As the economy opens back up, one way that businesses have been trying to meet the surge in pent-up demand is by hiring more employees. But that’s not easy: A survey out this week from the National Federation of Independent Business found that 42% of small business owners say they’ve recently had trouble filling open positions. That’s a record high.
For the past few months, the hiring situation at the Schlow Restaurant Group has been in crisis mode.
“There is a complete lack of applicants for jobs that we have open, and have had open, for a considerable amount of time,” CEO Spiro Pappadopoulos said. Pappadopoulos said the company is trying to hire around eight to 10 people for each of its 11 restaurants just to handle the current workload.
But he said a lot of people the company has been in touch with have said they’re reluctant to come back to work. “And when we were faced with nobody wanting to come back to their job, we realized we had to do something to get more competitive,” he said.
So the company’s been raising pay by around $5 an hour for entry level jobs. It’s also offering more benefits, flexible schedules and signing bonuses.
The NFIB found that around 30% of businesses say they’re offering higher wages, “Simply because the labor market’s getting tighter, and there are more and more job openings that we’re trying to fill,” NFIB chief economist Bill Dunkelberg said.
Dunkelberg said businesses have to compete with the amount of money people are receiving in unemployment benefits. “And, of course, they’re competing with each other for the people who are qualified.”
And even if a business owner believes the economy’s going to get better this year, many of them can’t afford to compete.
“We believe it’s going to be great, but it’s hard to make financial commitments under the belief things are going to be great,” said Ken Giddon, who runs a men’s clothing store called Rothmans in New York.
Giddon has been struggling to find workers, but offering them higher wages seems risky. Especially, he said, because his industry might not rebound with the rest of the economy. “So I’m in a business where I sell something people don’t really need. Men’s clothing — men can wear the same clothes for five years and not care that much about it.”
Giddon has been trying to fill three or four open positions. So far, he’s only been able to fill two.
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