According to the NFIB's monthly employment report, the percentage of small and medium-sized business owners nationwide who cite the quality of the labor force as the biggest problem in running small and medium-sized enterprises remains high at 20%. Labor costs, reported as the most important issue for business owners, rose one point to 9%, four points below the high of 13% set in December 2021.
“A tight labor market has been a consistent concern for small business owners throughout 2023,” said Bill Dunkelberg, chief economist at NFIB. “The level of job openings suggests a strong labor market will continue on Main Street in 2024 as employers raise compensation and consumers spend to attract qualified workers.”
“According to the Alabama Department of Labor, the labor force participation rate improved three-tenths of a percentage point from November to 78.4%,” said NFIB State Director Rosemary Elabash. Alabama small business owners continue to struggle to find qualified employees. NFIB continues its partnership with the Alabama Community College System Innovation Center to ensure students are ready for employment opportunities as soon as they receive their credentials. ”
40% of all owners (seasonally adjusted) reported that they were unable to fill a position this quarter, unchanged from November. Owners' plans to fill vacant positions remain high, with plans to create new jobs in the next three months at a seasonally adjusted net 16%, down 2 percentage points from November and recorded in August 2021. This is 16 points below the all-time high of 32 cases.
Overall, 55% of owners said they hired or were looking to hire in December, up one point from November. Among business owners who are hiring or looking to hire, 89% of owners reported that there are few or no qualified applicants for the positions they are hiring. 28% of owners reported that there were very few qualified applicants for their open positions, and 21% said no one applied.
On a seasonally adjusted basis, a net 36% of owners reported increasing their compensation, unchanged for the fifth straight month. A net 29% of owners plan to increase compensation within the next three months, down one point from November.
The number of job openings in the construction industry has increased by 9 percentage points since last month, with more than half of the jobs unfilled. The construction and transportation industries had the highest number of job openings, and the agriculture and finance industries had the lowest numbers.
Thirty-three percent of employers have openings for skilled workers, and 14 percent have openings for unskilled workers. Growth in manufacturing and construction is being held back by a shortage of skilled labor.