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Home > BizTimes Daily > Archives > November 7, 2006
Small business survey confirms labor shortage
Published November 7, 2006 - BizTimes Daily
The growing skilled labor shortage is reflected in the latest survey by the National Federation of Independent Business (NFIB).
According to the NFIB survey of small businesses in October: 55 percent hired or tried to hire; 83 percent of those trying to hire reported few or no qualified applicants; and 28 percent reported raising worker compensation, up from 24 percent in July, and the highest reading in 19 months.
"An historically high 63.3 percent of the adult population has a job and the unemployment rate is 4.4 percent in October. This does not sound like a labor market with deficient labor demand, but it's showing clear signs of a mismatch between supply and demand, with clear shortages of qualified workers," said NFIB chief economist William Dunkelberg.
"Job creation plans were also exceptionally strong, even though owners see the economy slowing down. Apparently there is a real hiring deficit in the small-business sector. Even with lower expected sales growth, more workers are desired, if they are qualified," Dunkelberg said. "Labor markets continue to tighten. More and more small-business owners have been paying higher compensation, and the labor force participation rate indicates that labor supply has responded, though not sufficiently to keep the unemployment rate from falling."
