Small Businesses Trending in U.S. Economy despite High Interest Rates: CBIZ Report

Struggles in hiring for small businesses appear to be improving

Despite high interest rates, the U.S. economy has shown unexpected strength in February, with small businesses steadily expanding their workforces. The CBIZ Small Business Employment Index indicated a 0.17% increase in hiring among small businesses in the month. According to Anna Rathbun, Chief Investment Officer of CBIZ, small businesses have been able to sustain this strength and retain their employees despite being unable to offer competitive salaries and benefits like health insurance.

The index monitors hiring among thousands of businesses with 300 or fewer employees nationwide. It showed that 20% of companies increased their staff, 60% maintained their headcounts, and 20% reduced staff. Sectors like administrative and support services, arts and entertainment, and technology and life sciences experienced hiring gains, while industries like accommodation and food services, insurance, and utilities witnessed decreases in employment. In terms of regional hiring patterns, the West, Southeast, and Central regions saw slight increases while the Northeast region saw a slight decline.

Small business hiring aligns with the overall job growth in the U.S. economy in February, as U.S employers added 275,000 jobs, surpassing expectations and displaying the economy’s resilience in the face of high-interest rates

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