Hiring troubles for small businesses improve as economy remains robust

Despite high interest rates, the U.S. economy continues to show strength and small businesses are gradually expanding their workforces throughout February, according to a report by the CBIZ Small Business Employment Index. The index monitors hiring trends among thousands of companies with 300 or fewer employees across the United States.

Small businesses often struggle to retain employees due to their inability to provide higher wages or additional benefits like health insurance. However, the CBIZ index reports that approximately 20% of companies in the index increased their staff in February, while 60% maintained the same headcounts. Meanwhile, 20% reduced their staff numbers.

Certain industries are performing more favorably than others, with sectors such as administrative and support services, arts, entertainment, recreation, and technology and life sciences showing hiring growth. In contrast, industries like accommodation and food services, insurance, and utilities experienced declines.

Regionally, the West, Southeast, and Central regions saw slight increases in hiring in February. However, the Northeast region faced a slight decrease in hiring trends among small businesses.

The hiring trends among small businesses mirror the broader market as U.S employers added 275,000 jobs in February – surpassing expectations and demonstrating the economy’s endurance despite high interest rates. This marks an increase from the 229,000 jobs gained in January of the same year.

By Samantha Johnson

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