An improved U.S. economy has led to steady job growth over the past year. Even so, the gains have been slow and erratic for small businesses compared to larger companies. Recent reports last month revealed the gap between overall hiring and that of small businesses.
According to The Labor Department, employers of all sizes added 201,000 jobs in August. This was compared to the 196,000 jobs averaged over the previous 12 months. Although the government does not share the numbers according to company size, a separate report shared by payroll provider ADP revealed that hiring at its small business customers fell by more than half in August.
ADP found that 21,000 new jobs were created at its small business customers – a staggering drop from 59,000 in July. In addition, these small businesses averaged 49,000 new Interim Executive Jobs for the first seven months of this year; this is down from 61,000 a month for all of 2017.
Why are some small businesses struggling to keep up with large companies when it comes to hiring? A survey released by the National Federation of Independent Business discovered the reason why. A quarter of the survey participants said their biggest problem was finding qualified workers.
These owners are also treading carefully, considering lessons learned from the Great Recession. Before the recession began (officially in December 2007), many firms hired in anticipation of getting new business. Now, businesses avoid hiring until they have enough new business to justify the expense. Other small businesses are unable to compete with big corporations that offer higher salaries and more lucrative benefit packages.
While small business lending has improved, most still struggle to find the working capital needed to hire new workers. Those who can find solutions are often concerned about the added debt. This is just one of the reasons why small business owners are turning to a merchant cash advance.
They can secure a flexible solution that provides quick cash to add to their team, and avoid an unnecessary burden of debt and fees. If your small business needs to hire new staff, consider the ways a merchant cash advance can help.
Author Bio: As the FAM account executive, Michael Hollis has funded millions by using merchant cash advance solutions. His experience and extensive knowledge of the industry has made him finance expert at First American Merchant.