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Only 9% of Small Business Owners Expect to Cut Staff Due to Automation



Impact of Automation on Small Business Employment: Only 9% of Small Business Owners Expect to Cut Staff Due to Automation

The new National Small Business Association (NSBA) and ZipRecruiter Report reveals only nine percent of small business owners expect to cut staff due to automation. More significantly, 24 percent said they would need more employees, while the majority, or 67 percent, said they would need the same number of workers.



Impact of Automation on Small Business Employment

The NSBA and ZipRecruiter Report provides comprehensive data on the state of small businesses. It covers demographics, sentiment, economic outlook, hiring, financing, technology, policies and much more. Members and nonmembers of NSBA totaling 1,633 small business owners participated in an online survey from Dec. 18, 2017 – Jan. 8, 2018 across all industries and states in the US.

Small businesses are experiencing record high numbers in different metrics, while at the same time showing optimism about the future. More than half, or 53 percent, reported higher revenues, and 84 percent said they are confident in the future of their business.

Impact of Automation on Small Business Employment: Only 9% of Small Business Owners Expect to Cut Staff Due to Automation

The report says there are decade highs in small business outlook, and small businesses continue to provide great opportunities for the labor force. Cathy Barrera, chief economist at online employment marketplace ZipRecruiter, which partnered with NSBA for the report, said in the press release, “We tend to think of corporate America when we think of career ladders, however, small businesses have ample opportunities for career growth.”

As to the impact of the gig economy, it hasn’t affected the number of full-time jobs that much, but part-time employment has increased in the past five years. Thirty-seven percent said they have increased the number of part-time employees, while only 17 percent decreased their full-time workers to part-time.





Automation, Employment and Wages

One of the biggest drivers for implementing automation solutions is customer expectation moving forward. A Pew Research Center survey revealed 65 percent of Americans expect more automation in businesses. Having this technology in place will make small businesses more efficient and productive, with or without more employees.

This will greatly depend on many factors, including industry and location, but wages will play a more important role in acquiring the right talent. The low employment rate, which is currently at 4.1 percent, has increased the level of competition in wages.

In the report, 58 percent said they have increased the wages of their employees in the last year. And another 64 percent expect to do the same in the coming year.

When asked, “How do you expect your average per-employee wages to increase over the next 12 months?” Twenty-one percent said 1 to 2 percent, 25 percent said 3 to 4 percent, and 11 percent indicated an increase of 5 to 6 percent. However, 35 percent said there wouldn’t be an increase and 2 percent said some or all of their employees will see a decrease.

The outlook in the National Small Business Association (NSBA) and ZipRecruiter Report is overall positive, but challenges remain.





Images: NSBA 1 Comment ▼


Michael Guta


Michael Guta Michael Guta is a Staff Writer for Small Business Trends focusing on business systems, gadgets and other small business news. He has a background in information and communications technology coordination.

One Reaction

  1. It helps cut down the time. But it doesn’t eliminate the need for someone to operate the tool. Humans are still essential to the implementation of a process.

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