Small businesses are optimistic, but have job openings they can’t fill
Small businesses are optimistic, but have job openings they can’t fill
Another snapshot of how small businesses are feeling in this economy is out: The National Federation of Independent Business’ monthly small business optimism index slipped in January, though the level of optimism still remains higher than average. The index also measures uncertainty, which rose to its third highest recorded reading.
Among the biggest challenges small firms are facing is hiring. More than a third of businesses surveyed said they had job openings they couldn’t fill in January.
The good news is that small businesses want to hire, said Holly Wade, executive director of the NFIB Research Center. The bad news?
“It’s been a really tough road over the last number of years to find applicants for those high level of job openings that they continue to have,” she said.
The survey found 90% of the small business owners trying to hire in January reported “few or no” qualified applicants.
Federal data show the ratio of open jobs to unemployed workers has been around 1 to 1 in recent months. But several industries, like construction, are struggling with a shortage of skilled labor.
“You don’t even get people to apply anymore,” said Bruce Jovaag. “I’ve pretty much given up.”
Jovaag owns Norse Construction in St Louis, Missouri. His crew of three to four guys do mostly kitchen and bathroom remodels, room additions and basement finishes. But if you’re dreaming of updated cabinets you’ll have to be patient: His wait list is about four months long.
“I would love to be able to run a much shorter wait time, but I just simply can’t,” he said.
Jovaag said finding specialized workers, like carpenters, is basically a lost cause. So he turns to subcontractors.
“I just had an interview recently with a gentleman, but his demands were just astronomical,” he said. “Health insurance and vacation right away and all this stuff — I can’t afford that.”
There’s been a labor shortage in the skilled trades for years, but it’s particularly tough for small firms, said Nich Tremper, senior economist at payroll platform Gusto.
“Small businesses have to compete with the big guys on labor costs, and a lot of times they just they can’t do that,” he said.
And questions about tariffs and immigration policies are making it even harder to plan for the future.
Stories You Might Like
There’s a lot happening in the world. Through it all, Marketplace is here for you.
You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible.
Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.
