Challenges in small business hiring are starting to improve.

Amid hiring challenges, small businesses in the U.S. are slowly expanding their workforces. In February, the CBIZ Small Business Employment Index reported a seasonally adjusted increase of 0.17%, indicating that small businesses are facing difficulties in retaining workers due to constraints such as low salaries and limited benefits like health insurance. Despite these challenges, the index monitors hiring activities among thousands of companies with 300 or fewer employees nationwide and shows that around 20% of companies hired more employees during February, while 60% maintained their headcounts and 20% reduced staff.

According to Anna Rathbun, the chief investment officer of CBIZ, the strength of the U.S. economy in the current high-interest-rate environment has led small businesses to steadily increase their hiring during February. The growth in hiring was seen across various industries, with administrative and support services, arts, entertainment, recreation, and technology and life sciences experiencing growth while accommodation and food services, insurance, and utilities experienced declines.

Regionally, the West, Southeast, and Central regions witnessed slight increases in hiring activity while the Northeast region saw a slight decline. This trend among small businesses is reflective of the broader market where U.S employers added 275,000 jobs in February surpassing expectations despite high interest rates. This job growth was higher than the revised gain of 229

By Samantha Johnson

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