Keeping an eye on jobs reports is essential to figuring out the health of our economy. There is another way to found out how things are going, however. Simply ask.
The most recent SCORE Megaphone of Mainstreet Report highlights that we may need to shift our views of how employment fits into business growth and success. Data taken from more than 1,700 small business owners seemed surprisingly optimistic about the future, but certain personnel challenges couldn’t be ignored.
More than half of the study participants (51.3%) cited the inability to find qualified applicants as their biggest hiring obstacle. Just slightly more (55.5%) said that this difficulty was worse over the past six months. These business owners found that personal referrals were essential in breaking through the hiring barrier; 19% found that their own workers were a good source of referrals, while other business owners were valuable to around 17%.
Gig Economy Is Where It’s At
Even with personal referrals having such a high priority in filling up the talent pipeline, small businesses were more than willing to take chances on talent outside of the organization. In fact, 37% of the participants experienced an increase in hiring “gig workers” — or those classified as contractors or part-time workers with somewhat flexible work arrangements. Almost 20% of businesses reported that they even replaced employees (either part-time or full-time) with these same gig workers in the past six months! Solo-preneurs also got into the gig economy, with these non-employer groups using part-time workers to do what approximately 3.2 workers would be doing in their business.
Given the trend to go “gig”, why would businesses keep employing people? There are benefits. Proponents of the standard employee relationship cite consistency of work (57%) and commitment to the company and its culture (53%). Many of these same companies used contractors for very specific skillsets or for temporary projects that might arise.
The Future’s Looking Bright
Despite the great lengths small businesses are going to get the best talent, it all seems to be in anticipation of a better tomorrow. Survey participants were overwhelmingly positive about what the next six months held in store for them; 68% were optimistic of growth for that timeframe. Even the youngest surveyed seem to be looking for the silver lining, as 82% business owners under 35 were at least somewhat optimistic about the same kind of growth. Millennials in this group were also less concerned about policies that favor large businesses and possible changes in healthcare, compared to the larger group of business owners.
Regardless of how optimistic businesses are for the future, the truth of the job market remains. Hiring and training talent takes resources, and the best time to secure business financing might be right now. Whether you choose to hire employees to help your brand shine bright – or you secure the talents of gig workers – staying adequately funded will be key to moving your dreams forward in these crucial next six months.