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Sunflower State News

Wednesday, September 10, 2025

Small businesses face hiring challenges amid eased compensation pressures

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Jessica Henrichs Senior Media Manager – Southwest | Official Website

Jessica Henrichs Senior Media Manager – Southwest | Official Website

NFIB's May jobs report reveals that 34% of small business owners reported unfilled job openings, a figure unchanged from April and the lowest since January 2021. Chief Economist Bill Dunkelberg commented on the situation, stating, "Amid uncertainty, small business owners’ hiring plans remain subdued in May." He also noted that compensation pressures have eased, providing relief for many.

State-specific data is not available, but NFIB State Director Dan Murray highlighted a common concern among members: "Our members are telling us that they want to create good-paying jobs, but qualified applicants are in short supply."

The report indicates that 55% of small business owners were hiring or attempting to hire in May, a slight decrease from April. Of those trying to hire, 48% reported few or no qualified applicants. Specifically, 29% found few qualified candidates while 19% found none.

Openings for skilled workers increased slightly to 30%, while openings for unskilled labor remained steady at 13%. The construction, transportation, and manufacturing sectors had the highest job openings; wholesale and professional services had the lowest. Job openings across most industries have decreased compared to last year.

A net 12% of owners plan to create new jobs within three months, down one point from April. Labor quality as a top operating problem decreased by three points to 16%, whereas labor costs as the primary issue rose by one point to 9%.

In terms of compensation changes, a net 26% of small business owners raised compensation in May—a seven-point drop from April and the lowest since February 2021. This marks the largest monthly decline since April 2020. Looking ahead, a net 20% plan to increase compensation over the next three months.

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