Labor Shortage Still Plaguing Small Businesses

small businesses labor shortage

Alignable’s Small Business Labor Poll was conducted among 6,367 small businesses and 60% of the respondents say labor shortage is still plaguing them. And the struggle is affecting a range of industry segments across the country.

Labor Shortage Plaguing Small Businesses

For some industries, labor shortages are catastrophic. This is especially the case for small retailers operating in communities around the U.S. The shortage, in many cases, is forcing retail shops and restaurants to close their shop. From closing early to not opening every day, small business owners are cutting hours. And according to Alignable, this “… further exacerbates their economic status — and doesn’t inspire much consumer confidence in the health of their businesses, either.”

When it comes to industries, 66% of all restaurants and 59% of all retailers say they can’t get enough help. In many regions these are businesses that serve their communities by employing local workers and serving a need. But the rate is much higher for Assisted Living/Senior Care sector, with 92% of small businesses saying they are short-staffed.

Additional small businesses suffering with considerable staffing shortages are:

  • 90% of spas/massage therapists
  • 80% of beauty salons & barbershops
  • 76% of manufacturers
  • 69% of construction firms
  • 68% in transportation (including truckers, as well as Lyft & Uber drivers)
  • 57% of gym owners/fitness trainers
  • 49% in the travel/lodging industry

The national average in labor shortage stands at 60% according to Alignable. However, the shortage in some states was much higher. In some key states, California leads the way with 65% followed by Pennsylvania (60%), Florida (58%), Ohio (57%), Texas (57%), and New York (52%).

As long as this trend continues, it is becoming a vicious circle small businesses can’t seem to dig themselves out off. Not only that, but owners are experiencing recovery reversals.

Recovery Reversals

For many small businesses that started to see the light at the end of the tunnel with their recovery, that light is dimming yet again as their recovery is being reversed. Only one industry sector, events, didn’t see any reversal in the Alignable poll. However, every other sector experienced from -3 to -24% drop in their recovery. Automotive was the highest at -24% followed by insurance -20%, and construction at -19% rounding up the top three.

According to the report from the survey, labor shortage, Omicron, and inflation are reversing the economic recovery. And only 14% of restaurants across the U.S. say they’ve fully recovered. This is down 18% from the 32% in December.

Read the rest of the Alignable Small Business Labor Poll for more on how small businesses are faring.

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Michael Guta Michael Guta is the Assistant Editor at Small Business Trends and currently manages its East African editorial team. Michael brings with him many years of content experience in the digital ecosystem covering a wide range of industries. He holds a B.S. in Information Communication Technology, with an emphasis in Technology Management.

One Reaction
  1. I think we also need to consider the larger picture around labor and the difficult truth is that many people want a job that is not physically demanding. So any job that requires them to be on their feet for 8 hours isn’t appealing until the wages become significantly higher. And that puts many businesses in a difficult position because they don’t have the margin in their current pricing to increase wages that much. But if they increase prices customers will complain and potentially stop coming.