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Improvement in Small Business Hiring Challenges as Economy Remains Robust

Byeditor

Mar 26, 2024

New York (AP) – Small businesses may be finding it easier to hire new employees, as reported by the CBIZ Small Business Employment Index. The index showed a 0.17% increase in February, indicating continued strength in the U.S. economy despite high interest rates.

Small businesses often struggle to retain workers as they are unable to offer higher salaries or additional benefits such as health insurance. The CBIZ index monitors hiring trends among thousands of companies with 300 or fewer employees across the country.

According to Anna Rathbun, the chief investment officer of CBIZ, the unexpected strength of the U.S. economy in the face of high interest rates has allowed small businesses to steadily expand their workforce during February. About 20% of companies in the index increased their staffing levels in February, while 60% kept their headcounts the same and 20% reduced staff numbers.

Certain industries, like administrative and support services, arts and recreation, and technology and life sciences, saw hiring gains, while industries like accommodation and food services, insurance, and utilities saw decreases. Regional differences were also noted, with the West, Southeast, and Central regions experiencing slight hiring increases, and the Northeast region experiencing a slight decline.

This trend in small business hiring mirrors the broader market, where U.S. employers added 275,000 jobs in February, surpassing expectations. This robust job growth showcases the resilience of the U.S. economy despite high interest rates. The increase in February followed a revised gain of 229,000 jobs in January.

By editor

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