The Small Business Talent Gap: New March Jobs Report Reveals Hiring Struggles
the staff of the Ridgewood blog
Ridgewood NJ, Is the “Great Resignation” over, or just evolving? The latest NFIB (National Federation of Independent Business) March Jobs Report is out, and it’s a mixed bag for the American economy. While the Small Business Employment Index saw a dip this month, the real story lies in a persistent, frustrating trend: small business owners simply cannot find the help they need.
Despite a cooling index, the demand for skilled labor remains at near-record highs, leaving many local “Main Street” shops in a hiring limbo.
By the Numbers: The March Employment Dip
The Small Business Employment Index fell 1.9 points in March, landing at 101.6. While a decline sounds concerning, context is key:
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2025 Average: 101.2
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Historical Average: 100.0
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Current Standing: Even with the dip, small business activity remains above historical norms, signaling resilience in a volatile market.
The “Unfilled” Crisis: 32% of Positions Sit Empty
The most staggering statistic from the report is the persistent vacancy rate. Thirty-two percent of small business owners reported job openings they were unable to fill in March.
While that is down 1% from February, it remains significantly higher than the historical average of 24%. The struggle is particularly acute in specialized sectors:
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Skilled Labor: 27% of owners have openings they can’t fill.
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Unskilled Labor: 12% of owners are searching for help (a 2-point increase).
“Small business owners continue to struggle finding applicants with the right skills for their open positions,” says Eileen Kean, NFIB New Jersey State Director. “Lawmakers should avoid policies that make it harder to hire, especially higher taxes and one-size-fits-all mandates.”
Quality vs. Cost: What’s Worrying Owners?
For the first time in years, the conversation is shifting from who can work to what it costs to keep them.
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Labor Quality: 15% of owners cite “labor quality” as their #1 problem. This metric hasn’t dropped below 15% since December 2016, highlighting a long-term skills gap in the workforce.
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Labor Costs: While quality concerns are flat, concerns over labor costs are rising. 10% of owners now say rising wages are their single biggest headache.
Compensation Trends: A Cooling Spring?
To attract talent, small businesses have been aggressively raising pay, but that trend may be hitting a ceiling.
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Raised Compensation: 33% of owners increased pay in March.
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Planned Increases: Only 18% plan to raise compensation in the next three months—the lowest reading since July 2025.
This suggests that while small businesses want to remain competitive, the record-breaking wage hikes of the last year may be slowing down as profit margins tighten.
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Tags: #SmallBusiness #Economy #HiringCrisis #LaborMarket #NFIB #BusinessNews #NJBusiness #Wages #EmploymentReport
