Small Businesses Add 90,000 Jobs
Small businesses saw an increase in 90,000 jobs during February, making a huge dent in the jobs last during January.The numbers were released in the ADP National Employment Report Wednesday.During January 2022, small businesses lost 96,000 jobs. Although the 90,000 job growth during February was strong, small businesses continued to struggle, according to ADP Chief Economist Nela Richardson.
Tight Labor Supply
Richardson said that the tight labor supply continues to create a barrier for small business hiring. “It’s a competitive environment for talent,” Richardson said. “On the flip side, large businesses are booming (with hiring) because they have larger budgets.” “There’s an elevated level of ‘quits’ with people changing jobs,” she added. “With the reduced numbers in the overall work force, you’ve seen that dynamic play out.”
Construction Industry Numbers
Richardson said that the construction industry is suffering “a dearth of available workers.” The industry is also struggling with the availability of construction materials. “Lumber and steel prices and shortages, and labor, are issues in new home construction,” Richardson said. “You may have the worker but not the material.”
Struggle to Find Workers
Richardson described the tension in the labor market as “an unhealthy level of tightness.” Job openings are at 7% (the percentage of available jobs that are not filled). During the 5 years leading up to the pandemic, job openings were steady at an average of 4%.
Small Business Employment Report Jobs Breakdown
Job gains for small, medium and large businesses were 455,000 during March, according to the report.Small businesses gained 90,000, with 37,000 gains in very small businesses (1-19 employees) and 53,000 in small businesses (20-49 employees).All the job gains were in the service provider category, up 94,000. In the goods producing category, there was a loss of 5,000 jobs.
Franchises gained 11,200 jobs, with the majority of those gains in auto parts/dealers (7,700) and accommodations (2,200). Other gains were modest, with both restaurants and business services gaining 400 jobs each, and food retailers and real estate gaining 200 jobs each.