Spring Economic Outlook: Small Businesses are Planning to Hire
Is your small business planning to hire this spring? You’re not alone. According to PNC’s Spring Economic Outlook survey of small to mid-size business owners, one in five plan to add full-time employees in the next six months, up 10 percent from last fall, and the highest percentage since 2012.
Small businesses are hiring because they’re feeling optimistic, both about their own businesses and the economy as a whole. Almost four in 10 are “strongly optimistic” about their own business prospects for the next six months. Just 12 percent are pessimistic—the fewest since before the recession in 2007. More than half (55 percent) expect increased sales in the next six months, while 41 percent expect to see higher profits—the highest both measures have been since 2012.
Entrepreneurs aren’t feeling quite as sunny about the overall economy; just 13 percent are “strongly optimistic” about it, but that’s almost double the 7 percent who felt that way last fall. In addition, 64 percent are feeling “moderately optimistic”—the most since 2007.
Employees are benefiting from small business’ owners rosy outlook. In addition to hiring plans, more than 30 percent of small business owners plan to increase employees’ salaries in the next six months, up 10 percentage points from last fall.
Maybe because so many are already planning to raise wages, seven out of 10 small business owners say an increase in the federal minimum wage wouldn’t affect their plans to hire new workers.
How does this outlook affect your business?
- If you’re planning to hire, know that the hiring market is going to get even more competitive. Consider what factors you can emphasize to make your workplace a desirable one for prospective workers.
- If you’re not planning to hire, be aware that many of your existing employees are likely looking for new jobs. To keep them happy and engaged, start by making sure your wages and salaries are competitive for your industry and location.
- If you expect sales and profits to rise, use some of the money to benefit your employees. Consider reinstating extras you may have cut during the recession, such as matching 401(k) contributions, offering profit-sharing plans or giving bonuses tied to performance.
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