May 21, 2024 12:31 pm
Hiring challenges for small businesses improving with continued economic strength

The latest data from the CBIZ Small Business Employment Index indicates that hiring conditions for small businesses may be improving, as there was a seasonally adjusted increase of 0.17% in February. This suggests that small businesses are slowly adding to their workforce as the U.S. economy continues to perform well despite high interest rates.

Small businesses often struggle to retain employees due to their inability to offer competitive salaries or benefits like health insurance. However, the CBIZ index monitors hiring trends among thousands of companies with 300 or fewer employees across the country, and recent data shows that many companies are beginning to hire more employees.

According to Anna Rathbun, chief investment officer at CBIZ, the unexpected strength of the U.S. economy is reflected in the steady expansion of small business workforces in February. Approximately 20% of companies in the index hired more employees, while 60% maintained their current headcounts and 20% reduced staff.

Certain industries are faring better than others in terms of hiring, with sectors such as administrative and support services, arts and entertainment, and technology and life sciences experiencing gains. Conversely, industries like accommodation and food services, insurance, and utilities saw decreases in hiring.

Regionally, the West, Southeast, and Central regions saw slight increases in hiring, while the Northeast region experienced a slight decline. This trend aligns with broader market trends, as U.S. employers added 275,000 jobs in February

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