Hiring troubles for small businesses improve as economy remains robust

Despite high interest rates, the U.S. economy continues to show strength, and small businesses are gradually expanding their workforces throughout February, according to the CBIZ Small Business Employment Index. The index monitors hiring trends among thousands of companies with 300 or fewer employees across the United States.

Small businesses often struggle to retain employees due to their inability to provide higher wages or additional benefits like health insurance. However, the resilience of the U.S. economy has allowed small businesses to capitalize on this strength and hire more workers. Approximately 20% of companies in the index increased their staff, while 60% maintained the same headcounts. Meanwhile, 20% reduced their staff numbers.

Certain industries are performing more favorably than others. Sectors such as administrative and support services, arts, entertainment, recreation, and technology and life sciences showed hiring growth, while industries like accommodation and food services, insurance, and utilities experienced declines. The hiring trends among small businesses mirror the broader market as U.S. employers added 275,000 jobs in February – surpassing expectations and demonstrating the economy’s endurance despite high interest rates.

Regionally, the West, Southeast, and Central regions saw slight increases in hiring while the Northeast region faced a slight decrease in hiring trends among small businesses mirror those of large corporations as U.S.-based firms continue to grow despite challenges from global economic factors like inflationary pressures and supply chain disruptions

By Sophia Gonzalez

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