As U.S. jobs go begging, forget the 200,000 monthly gains

Small firms across the U.S. face persistent vacancies or are turning away customers because they lack enough staff in a tight job market. Such difficulties also indicate nationwide payroll gains will eventually cool from this year’s average monthly pace of 200,000, amid relatively slow growth in the labor force.

Ahead of the government’s monthly employment report due today, ADP Research Institute figures showed small firms’ hiring lagged that of large companies in May, similar to the trend in recent years.

Some 22 percent of small businesses in April said finding qualified workers was their “single most important business problem,” ahead of taxes or regulations, according to the National Federation of Independent Business.

Small companies are nonetheless adopting many of their larger rivals’ tactics that are creative and sometimes cheaper, ranging from part-time jobs, flexible shifts, or allowing people to work from home, to helping with student-loan repayments. They’re also using more technology and social media to reach potential hires, especially millennials.

Unlike large firms who can poach employees easily because of resources including dedicated recruitment teams, small companies “don’t have the benefits packages to attract” workers amid the shortage of qualified labor, said Martin Mucci, chief executive officer of Paychex Inc., a provider of payrolls processing and other services to more than 600,000 U.S. businesses.

Lately, small-firm employment is moderating, consistent with the later stage of an economic cycle, Mucci said. During the past year, job growth slowed nearly 1 percent for businesses with fewer than 50 employees while cooling only a quarter of a percent for those that employ up to 1,000 people, a Paychex analysis showed.