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Even with job gains, small businesses are struggling to hire workers


An “now hiring” sign was posted on the windows of Los Angeles’ restaurant, January 28, 2022.

Frederic J. Brown | AFP | Getty Images

According to the latest Nonfarm Payroll Report, there is a near recovery in labor markets from pre-pandemic levels. However small business owners throughout America say finding qualified workers remains a major challenge.

February job growthIt posted its highest monthly gain since July with nonfarm payrolls rising by 678,000. The unemployment rate was 3.8%.

In the U.S. in 2021 there was an additional 6.665million jobs. President Joe Biden noted this figure in his State of the Union Address as the greatest single-year growth in American history. Although the market for jobs is now about one million (1.14 millions) less than pre-pandemic levels, it still faces a significant shortage of workers to fill the open positions. This number stood at more than 10 million as of last year.

Main Street is an area in which this labor battle continues. According to the Bureau of Labor Statistics, 5522,000 new jobs were added by companies employing 500 workers or more in February. ADP’s private payrolls reportFrom earlier in the week. This was the reason for nearly all the ADP job gains. Companies with less than 50 employees saw a decrease of 96,000 workers during the month.

According to recent research, 52 percent of small-business owners stated that finding qualified employees to work for them has become more difficult than it was a year ago. CNBC/SurveyMonkey Small Business SurveyThe first quarter of 2022. This is an increase of 50% from Q4 2021.

A quarter of small-business owners stated they had open positions for more than three months and that they were unable to fill them. Seventy percent of smaller businesses employing over 50 people said that turnover is likely to become a major problem in the next six months.

Struggles for workers

Laura Wronski is senior research scientist at the University of Wisconsin. She stated, “Every single data point we have about the economy from all possible sources indicates that we are in an incredibly difficult hiring market.” SurveyMonkeyCNBC’s survey is conducted by. The unemployment rate is very low, but the inflation is quite high. Therefore wages must be extremely high in order to draw workers.

This latest report on nonfarm payroll shows that wages have declined in spite of sharp inflation. They increased just 1c per hour or 0.03% compared with 0.5%. This was well below expectations of 5.8%.

Wronski explained that, despite the increase in eligible workers searching for jobs after the Great Resignation,” it was still difficult for small businesses to find employees.

Latest data from NFIB’s monthly jobs report22 percent of small-business owners reported in February that their main problem was labor quality. However, the recent high of 48 years for those who claimed labor costs were the number one problem was not reached.

Jennifer Park, WearEver Jewelry’s owner in Alexandria, Virginia said she is constantly challenged by finding qualified workers and keeping those employees she hires.

Park claimed that she created a SimpleHired job listing after her employee quit in July to look after her baby. It attracted just 21 candidates over two months. Park hired someone via that method, but the person she chose quit within three weeks of starting, which left her back at where she began. Also, she employed someone for about two weeks who tested positive to Covid-19 after which she resigned. In addition, several candidates have failed to show up for interviews.

Park stated that it takes time to find people and to train them. He also said they need to conduct background checks and show them the ropes. Park said, “It has been very frustrating.”

Park stated that she thinks there are a number of factors that contribute to why it is so difficult to hire new workers. One of these being the fact that many women are staying home with their children.

The National Women’s Law Center recently found that there was evidence of these issues in recent research nearly 1.1 million fewer women in the labor workforce in February 2022 compared to 2020 while men have recouped all of their job losses since the pandemic began, a gap that is being furthered by childcare concerns.

Park explained that we aren’t even considering those applicants. “If they have small children, then they either have someone to look after them, or they don’t have school to send them,” Park added.

It is also important to note that working for small businesses in retail environments often involves weekend work. This makes it less glamorous than other occupations.

Park stated that while she tried to improve the perks she offers and increase sales opportunities like commissions, the reality is she faces the same problems as any other company in terms of increasing costs and supply chain issues which limits what she can accomplish.

CNBC has more information about the Small Business Playbook

Didier Trinh (director of policy and political influence at Main Street Alliance), a progressive trade association for small businesses, stated that small businesses continue to struggle even with some government aid, such as the American Rescue Plan.

He stated that “despite the fact that small business have proven time and again their resilience and ability to adapt to extremely fast-changing conditions, they are not at the same level of profitability as they were prior to the pandemic.”

The attractiveness of certain roles is waning

Employment in leisure and hospitality saw a 179,000 increase, however Main Street businesses were still struggling to hire the right workers.

Marie Raboin (co-founder) of Brix Cider cider in Mount Horeb Wisconsin said that part of the problem for her company of 20 people was to get them back in the restaurant/foodservice industry, as other opportunities have opened up.

She said that service workers could find nine-to-five jobs in the service sector and were paid as well as other benefits. “I can’t fault them. I can’t blame anybody for doing it and I understand why.

Raboin raised her wages and offered other perks, such as free classes at the local yoga studio. However, this hasn’t resulted to an increase in applicants. Recently, she stated that one applicant applied for a job she had posted for three consecutive weeks.

According to her, “We are finding that turnover is costing our company more money than just like sucking it all up and working more hours.” We are willing to take more patience than hiring people to do the job.

Raboin indicated that hiring will be challenging in the near future, in particular in her field, as well as in industries where larger firms offer greater opportunities for potential employees.

According to her, “With the economy boomed in different sectors, people were able find better jobs.” My dad and mom bartended and were both waitresses. Those jobs, which paid well, could have provided the income to support a family. However, things haven’t changed for them.