NFIB: Small Business Owners Look to Raise Compensation

According to the National Federation of Independent Business (NFIB)’s monthly jobs report, 40 percent (seasonally adjusted) of small business owners reported job openings they could not fill in the current period, down two points from last month and the lowest level since February 2021. Seasonally adjusted, a net 36 percent of owners reported raising compensation in August, tying June’s reading, and marking the lowest reading since May 2021. A net 26 percent of owners plan to raise compensation in the next three months, up five points from July.

“More small business owners are planning to increase compensation in the next three months as unfilled job openings slipped in August,” said Bill Dunkelberg, NFIB Chief Economist. “Even as openings fell on Main Street, owners are actively working to retain current employees and attract qualified applicants.”

The percent of owners reporting labor quality as their top business operating problem remains elevated at 24 percent. Labor costs reported as the single most important problem to business owners decreased two points to 8 percent, five points below the highest reading of 13 percent reached in December 2021.

Small business owners’ plans to fill open positions remain elevated, with a seasonally adjusted net 17 percent planning to create new jobs in the next months, unchanged from July but 15 points below its record high reading of 32 reached in August 2021.

Overall, 59 percent of owners reported hiring or trying to hire in August, down two points from July. Of those hiring or trying to hire, 92 percent of owners reported few or no qualified applicants for the positions they were trying to fill, down two points from July. Thirty-three percent of owners reported few qualified applicants for their open positions and 21 percent reported none.

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