Nearly three-fourths of small businesses expect to increase sales in the next six months—but hiring struggles are putting a damper on these prospects, according to a survey of 500 small-to-medium-sized businesses conducted in August and released Tuesday by PNC.
According to an analysis of the survey from Inc., labor availability is the most-cited concern, and of those experiencing hiring difficulties, 58% point to enhanced federal unemployment benefits as the culprit.
With expanded federal unemployment benefits having ended on Labor Day—reducing unemployment pay by $300 a week—businesses widely believed they would see a surge in job applicants. But the expected surge hasn’t yet materialized.
Small businesses are now addressing the labor shortage directly by improving pay and benefits. Of those businesses surveyed, more than four in 10 say they’ve increased compensation to help attract and retain talent, and 44% have started allowing more flexible work arrangements. Nearly half have also begun implementing improved health and safety measures.
More than half (54%) of business owners surveyed say they anticipate raising prices as a result of the increased labor costs. Read the full story.