Changing Search for Employees
• Labor markets are currently in transition. They are moving from being very difficult for small employers to locate qualified employees to ones where small employers are encountering fewer problems. Still, 71 percent of small employers who have recently sought employees say that qualified employees are “hard” to find compared to 29 percent who say they are not.
• The most frequent response to tight labor markets by small employers is to allow unfilled positions to remain vacant. Two-thirds report that they respond to difficult labor markets, at least in part, by going without needed employees. The smallest employers, i.e., those employing fewer than 10 people, are the most likely to choose this course.
• The primary consequence of not being able to fill a job vacancy (83% of the time) is that the small employer must work more hours; the second most frequent consequence (62%) is that other employees must work more hours; about half of the time, small employers who do not (cannot) fill vacant positions limit business output, e.g., shorter business hours, refused jobs.
• Sixty-four (64) percent of small employers choose to increase training their labor forces as a response to labor shortages. Training increases are across-the-board (for all employees) rather than focused on a particular type of employee.
• One in three (34) small employers try to out-bid other employers when they need people. Most frequently they compete offering higher wages. An offer of more flexible working conditions is the second most common means of attempting to out-bid others.
• Easing labor markets first result in greater selection among prospective employees. The most frequent standards raised when labor markets ease involve job skill requirements followed by personal conduct and attitude requirements. The standards raised least frequently are education requirements.
• “Employee quits” is the most common form of employee separation from a small business. Two-thirds of new hires among operating small firms are to replace people who have left while one-third are to fill newly created positions.
• While more employees leave large firms than small ones, the average number leaving during the first third of the year (14%) was the same for all sizes of small employers. Over two-thirds of firms with fewer than 10 employees saw no one leave in the first third of the year.
• By almost a 6 - 1 margin, small employers believe the preferred strategy to deal with their labor forces is to “do all you can to retain employees working for you” in contrast to
recognizing “that employee turnover is inevitable and focus on hiring good new people.”
• Nearly half of all small employers report that they are “very satisfied” with their current workforce and 41 percent say they are “generally satisfied.” Those satisfied with their employees outnumber those not satisfied by more than a 9 -1 ratio.