In July, 33% of small business owners reported having job openings they could not fill, according to the National Federation of Independent Business (NFIB). This figure is a decrease of three percentage points from June and represents the lowest level since December 2020. However, it remains higher than the historical average of 25%.
The NFIB’s July jobs report also noted that 21% of small business owners cited labor quality as their most important problem, an increase of five points from June. This marks the largest monthly rise since August 2022.
Chief Economist Bill Dunkelberg commented on the findings: “The challenge of finding qualified workers is easing overall but still remained significant for many small business owners in July. The easing labor market pressures are also reflected in fewer firms raising compensation.”
The survey found that 57% of small business owners were hiring or trying to hire in July, which is one point lower than June. Of those seeking employees, 48% reported receiving few or no qualified applicants for open positions—a two-point drop from the previous month. Twenty-nine percent said there were few qualified applicants, while 19% reported none.
Openings for skilled workers stood at 29%, down by one point, and openings for unskilled labor were at 12%, also down by one point. The construction, wholesale, and transportation sectors had the highest job openings; finance and agriculture had the lowest.
Looking ahead, a seasonally adjusted net 14% of owners plan to create new jobs within three months—one point higher than in June and above the historical average net gain of 11%.
In terms of wages, a net 27% (seasonally adjusted) raised compensation in July, which is six points lower than June. A net 17% plan to raise compensation over the next three months—down two points from last month. Reports citing labor costs as the top problem dropped by one point to reach 9%.
The full NFIB Jobs Report can be viewed here.
