Welcome to the Small Business Weekly Rundown. Each week, we bring you stories and trends that impact small business owners and their workforce.
Small Business News Highlights:
- Economy adds 559,000 more jobs in May
- Unemployment rate drops to 5.8% as labor shortage persists
- Childcare remains persistent barrier for many parents to reenter the workforce
- Many employees quit instead of giving up working from home to return to the office
- Only 1 in 10 job posting offer remote work as an option
Economy adds 559,000 more jobs in May
“Today’s jobs report shows historic progress for American families and the American economy. We added 559,000 jobs in May, created a record two million jobs in our first four months, and unemployment is at its lowest level since the pandemic started.”
The jobs report released today indicated that the U.S. economy added 559,000 new jobs in April, missing the mark forecasted by many economists by over 100,000.
The hospitality industry led the way with 292,000 new positions, while data shows that small business job growth held steady from April to May. Texas came in first in the U.S. for small business job creation despite slow-downs in the construction industry.
The U.S. has recovered approximately two-thirds of the total number of jobs lost due to the Covid-19 pandemic.
Unemployment rate drops to 5.8% as labor shortage persists
“Only a few months ago we had expected to see several months’ worth of gains north of one million as the economy reopened, but labor supply is bouncing back much more slowly than demand.”
Despite the shortfall in anticipated job creation, the national unemployment rate dropped again last month to 5.8%.
Currently, 25 states, all led by Republican governors, have ended participation in the federal government’s expanded unemployment insurance program, resulting in 3.7 million Americans losing benefits early.
Childcare remains persistent barrier for many parents to reenter the workforce
“We’re getting a range of wait-list dates. Some are in the fall. Some are saying ‘Talk to us next year.’”
The Covid-19 pandemic may be subsiding in the U.S., but another crisis is on the horizon for many American families: a critical shortage of affordable childcare.
Across the country, childcare centers are closing or scaling back operations due to a lack of qualified staff. This shortage, in turn, has caused problems for parents desperate to find childcare before returning to the office.
At many facilities, the waitlist is months long, while other centers tell parents to try again next year. Preschool and daycare directors note that they’re doing their best to attract and retain staff, however, unlike many other industries, they can’t raise wages without passing the costs directly on to the consumers.
Many employees quit instead of giving up working from home to return to the office
“During Covid I really started to see how much I enjoyed working from home.”
While working from home is a necessity for many people with young children who can’t go to daycare, other employees are finding that teleworking is so preferable that they’d rather quit than return to the office.
Currently, only about 28% of American office workers are back in the office, while 29% say that they will consider quitting if they’re unable to continue teleworking.
Only 1 in 10 job posting offer remote work as an option
“There’s a big mismatch between what job seekers are looking for and what’s really available.”
For all the workers considering quitting before going back to the office, consider this: only about 10% of job postings offer the option of working from home.
Despite the prevalence of teleworking during the pandemic, companies are not necessarily offering the choice to work from home to new job seekers.
Even so, recruiting and HR experts do believe that a shift is coming due to the country’s significant labor shortage and the willingness of approximately one-third of workers to take a paycut in order to stay home.
The latest from Workest
June is chock-full of reasons to celebrate and causes to acknowledge. Keep them all straight with this Small Business and HR Compliance Calendar.
Attracting and retaining talented Millennial and Gen Y workers requires different strategies than the ones used to engage Gen Xers and Baby Boomers. Kelsey Banerjee provides tips for engaging younger generations in the workplace.
Finally, before we say goodbye for the week, here are 3 things you should know:
- The number of positive drug tests is increasing among job seekers as marijuana legalization expands across the country.
- Many Americans still want restaurant workers to continue wearing masks and 30% believe that dining inside a quick service restaurant is still a bad idea.
- The debate about the labor shortage doesn’t end at expanded unemployment benefits. Sociologists point to “demographic draught” as another key cause of the declining workforce.