Small Businesses Expand Their Workforces Despite High Interest Rates: CBIZ Small Business Employment Index

Challenges in small business hiring are starting to improve due to a stable economy

Despite high interest rates, small businesses are expanding their workforces in the strong U.S. economy, according to the CBIZ Small Business Employment Index. In February, there was a seasonally adjusted increase of 0.17%. The index tracks hiring trends among thousands of companies with 300 or fewer employees nationwide.

Small businesses often struggle to retain workers due to their inability to offer higher salaries or benefits like health insurance. However, some industries are experiencing hiring gains, while others are cutting back on staffing. The West, Southeast, and Central regions saw slight increases in hiring, while the Northeast region saw a slight decline.

The trend in small business hiring aligns with the broader market trend, as U.S. employers added 275,000 jobs in February, surpassing expectations and demonstrating the resilience of the U.S. economy in the face of high interest rates. This job growth was higher than the previous month’s revised gain of 229,000 jobs and is an encouraging sign for small businesses looking to expand their teams in the coming months.

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