NFIB's November jobs report indicates a rise in labor costs for small businesses, with 36% of owners reporting unfilled job openings, an increase from October. Labor costs have become a significant concern, rising to 11%, close to the peak level recorded in December 2021.
NFIB Chief Economist Bill Dunkelberg commented on the situation: “As the overall job market softens, hiring among small businesses remains a struggle. Main Street owners continue to feel pressure to raise compensation at historically high levels to attract and retain workers.”
State-specific data is not available, but NFIB State Director Katie Burns highlighted the ongoing challenges: “Hiring new team members remains an enormous challenge for our small business owners. Qualified applicants are in short supply, forcing employers to raise wages to retain their current workforce and attract new talent.”
A net 32% of small business owners reported increasing compensation in November, slightly up from October. Additionally, a net 28% plan further increases in the next three months, marking this year's highest projection.
The percentage of owners citing labor quality as their primary issue decreased by one point to 19%. Meanwhile, a net 18% of owners intend to create new jobs within three months, showing an upward trend.
In November, 55% of small business owners were hiring or attempting to hire, an increase from October. Among them, 48% reported few or no qualified applicants for their positions. Specifically, 29% encountered few qualified candidates and 19% found none.
Openings for skilled workers decreased slightly to 30%, while those for unskilled labor fell to 13%. The transportation, construction, and professional services sectors had the most job openings. In contrast, agriculture and finance sectors had fewer vacancies. Notably, construction sector openings rose five points from last month with over half unable to fill positions.
