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Easing of Small Business Hiring Challenges Indicates Continued Economic Strength

Byeditor

Mar 27, 2024

Small businesses may be experiencing some relief when it comes to hiring challenges. The latest data from the CBIZ Small Business Employment Index shows a seasonally adjusted increase of 0.17% in February, indicating that small businesses are continuing to expand their workforce despite the current economic conditions, including high interest rates.

One of the challenges small businesses face in hiring and retaining employees is their inability to offer competitive salaries or benefits like health insurance. The CBIZ index monitors hiring trends among thousands of companies with 300 or fewer employees across the country, providing insight into the state of small business employment.

According to Anna Rathbun, the chief investment officer of CBIZ, the unexpected strength of the U.S. economy is being reflected in the steady growth of small business hiring. In February, 20% of companies in the index increased their staff, while 60% maintained their current headcounts and 20% reduced staff numbers.

Different industries are experiencing varying levels of hiring activity, with sectors like administrative and support services, arts, entertainment, and technology and life sciences seeing gains. Conversely, industries such as accommodation and food services, insurance, and utilities reported decreases in hiring.

Regionally, the West, Southeast, and Central regions saw slight increases in hiring, while the Northeast region experienced a slight decline. This regional variation in hiring trends reflects the diverse economic landscape across the country.

The positive hiring trend among small businesses mirrors the broader market, as U.S. employers added 275,000 jobs in February, exceeding expectations. This growth in job numbers is a testament to the resilience of the U.S. economy in the face of challenges such as high interest rates. With job growth on the rise, small businesses and the overall economy are showing signs of strength and stability.

By editor

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