Small business owners are concerned mostly about labor quality, a report from the National Federation of Independent Business (NFIB) has found.
In its monthly jobs report, the NFIB found that 20 percent of small business owners identified labor quality as their top operating problem, followed by labor costs at 9 percent. Forty percent of respondents to the organization’s survey said they have job openings they can’t fill.
“The tight labor market has been a consistent concern for small business owners throughout 2023,” NFIB Chief Economist Bill Dunkelberg said. “The level of job openings suggests a solid labor market will continue on Main Street for 2024, as owners raise compensation to attract qualified workers and consumers spend.”
The survey found that the number of owners reporting job openings they could not fill remained unchanged from November. Owners said they have plans to fill open positions, with 16 percent planning to create new jobs in the next two months. Overall, more than half (55 percent) of the respondents said they hired or tried to hire in December. However, 28 percent of respondents reported they had few qualified applicants for the open positions, and 21 percent reported that they had no qualified applicants.
To combat the issue, a net (seasonally adjusted) total of 36 percent said they raised compensation, while 29 percent said they plan to raise compensation in the next three months.
The industries seeing the most job openings were construction and transportation. Over half of the owners in the construction sector said they have job openings they can’t fill. The sectors with the lowest number of unfilled jobs were agriculture and finance. NFIB said its report finds that growth in the manufacturing and construction sectors is hampered by the lack of skilled labor.