Small business hiring lags behind larger companies, ADP says
By JOYCE M. ROSENBERG
AP Business Writer
New reports from payroll company ADP show that small businesses are lagging behind larger companies in hiring, a trend that’s not expected to change anytime soon.
ADP’s monthly report on small business employment released at the end of January showed companies with up to 49 employees created 63,000 jobs during January. That’s down from an upwardly revised 107,000 in December. ADP counts the jobs at its small business customers in compiling its report.
In a separate report that looked at employment trends in the fourth quarter of 2018, ADP found that small business employment grew 0.5 percent from a year earlier, slower than the 1.7 percent growth at all the companies it tracks.
The tight labor market will continue to limit hiring at small businesses, ADP said in its report: “This trend will persist as firms find it increasingly difficult to find and hire qualified workers.” It also noted that small companies can be at a competitive disadvantage because they can’t match the salaries and benefits that larger companies provide.
The fourth-quarter report showed the disparity between small and large company compensation. Wages rose 1.9 percent from a year earlier at small businesses, compared to 3.4 percent at companies of all sizes and 4.9 percent at companies with more than 1,000 employees.
Small business owners have said in surveys over the past few years that they’re having a hard time filling their open positions. In a survey released in November by Bank of America, 58 percent of the more than 1,000 owners surveyed said they had difficulty in hiring. More than 80 percent said they have offered bonuses, flexible hours and work locations and other benefits to attract candidates.