Hiring Comes to a Halt

Although small business optimism is on the upswing after hitting its all-time low one year ago and job cuts have abated, hiring is close to a standstill as most employers are still hesitant to add workers. The number of new hires remains near an all-time low, according to the Bureau of Labor Statistics, and almost 70 percent of companies expect no change in their fourth-quarter hiring plans, according to a recent study by employment services company Manpower.

The American Express OPEN September Small Business Monitor shows only 23 percent of small business owners plan to hire, which is the lowest reading in the history of the Monitor (falling below the fall 2002 recession level of 26 percent).

In general, deteriorating employee morale has plateaued. Only 12 percent say morale has worsened over the last six months (down from 25 percent for the preceding six-month period), the Monitor reports. Three-quarters say morale has stayed the same, and 9 percent say it has improved. In addition, approximately 28 percent of business owners see offering financial incentives such as bonuses and paid time off as a way to increase employee morale, and 23 percent see more regular communication about the business as the key to improving morale.

Ted Bentz agrees with this. As the owner of $485,000 Second Nature in Rapid City, S.D., finding and retaining quality employees is his No. 1 concern. Paying attention to prospective employees who walk in the door and observing and listening to those employees who are on the payroll is how Bentz does it. A job-based incentive program also helps keep employees motivated.

Also, fewer business owners are laying people off (15 percent, down from 23 percent in March) or cutting benefits (8 percent versus 16 percent in March), according to the Monitor. One in 10 business owners (11 percent) say they have recently hired someone who was laid off.

“We’ve hired a bunch of really quality people who had other jobs like construction and got laid off during these hard times,” shares Mark Lay, owner of AA Tex Lawn Co., a 50- to 65-employee company based in Charlotte, N.C. The goal is to train them in the landscape industry so they can thrive in their new positions.

According to the Monitor, small businesses in the South are most willing to hire (31 percent vs. 22 percent in the West, 17 percent in the Northeast and 15 percent in north central states).

The author is editor of Lawn & Landscape. Reach her at nwisniewski@gie.net.