Increasing number of small businesses concerned about economy, survey finds
52% of small businesses say their biggest challenge is finding qualified job candidates.
Small businesses operate very differently than larger companies, and have different concerns, too. A recent ADP Research Institute survey dived into those concerns when they polled small business owners about their outlook on the economy, hiring plans, and other challenges. The research found that small businesses are primarily concerned about finding and attracting qualified employees, though the economic climate is increasingly of concern as well.
The survey, which was done on thousands of businesses, found that 52% of small businesses say their biggest challenge is finding qualified job candidates. That number sat even higher, at 72%, for midsize businesses. Likewise, while 22% of small businesses say they’re prioritizing employee retention, 44% of midsize business owners say the same.
The survey also asked respondents to rank the top way to attract and retain employees. Small businesses had the same answers for attraction and retention, prioritizing a flexible work schedule, special bonuses or increased pay, and better retirement plans. Accordingly, these three benefits are the most likely to be offered to employees of small businesses.
Other survey findings include that, while more than a third of all small businesses are concerned about the economy, some 60% of them don’t plan to pause hiring in the next three months, with a much lower 15% saying they will definitely put a hold on roles. The same share of small businesses, around 60%, say they aren’t going to decrease wages in the next three months, either – though they also don’t plan to offer any raises.
Instead, to manage inflation and other economic pressures, small businesses seem to be turning to price increases, with more than half of all small companies saying they’ve raised prices in the last three months, according to the survey. Another third report that they plan to increase prices again within the next three months. Most business owners expect price hikes to be permanent.
Related: 3 ways small businesses can attract and retain top talent amid today’s competitive labor market
Different businesses are more or less likely to face different challenges, depending on which industry they’re in. For instance, the construction and service industries have been particularly pressured in recent months due to increased input prices, whereas far fewer finance firms note this as a challenge. On the other hand, finance businesses have higher than average concerns about regulatory issues.
The food services and retail industries have the highest mean number of challenges of the industries surveyed, while the scientific and technical sector has the fewest.