Ohio employers boost pay, benefits in attempt to attract more workers in tight labor market

Ohio’s jobless rate was 4.6% in August, close to 18-year low.

Ohio’s small- and medium-size business owners say they’re raising wages, boosting benefits and taking other steps to keep and attract employees in the tight labor market.

About two-thirds of the 150 business owners surveyed for PNC Bank’s fall economic survey say they’ve taken one or more steps in response to the labor conditions.

The top choice among 36 percent of those surveyed is increasing wages while 21 percent say they’re offering bonuses and 18 percent say they’re raising benefits. Nearly 30 percent say they have allowed more flexible work arrangements and 14 percent say they’ve relaxed hiring standards.

Ohio’s unemployment rate was 4.6 percent in August, higher than it was earlier in the year, but still close to an 18-year low. Employers routinely complain that they have trouble finding workers to fill openings.

That wasn’t the case for several years during and after the Great Recession when employers had their pick of applicants.

“It’s a tight labor force. Businesses are competing for workers,” said Bill Adams, a PNC senior economist. “That’s the dynamic we’re in in Ohio. That’s where we expect the market to stay in 2019. It’s a challenge for employers. It’s a good problem to have.”

That some employers are loosening standards to hire workers “is great news for people trying to get into the job market, but haven’t been able to,” he said.

Despite tight labor market conditions, business owners continue to be optimistic about the outlook for their companies and the state and U.S. economy, the survey showed.

The survey also found that 24 percent of employers plan to hire over the next six months while 3 percent say they’ll cut staff. A key reason for hiring is because of a growth in business, the survey found.

Of those surveyed, 47 percent said they were optimistic about the prospects of their business, down from 52 percent in the spring survey, but still high.

The fall survey also found 48 percent are optimistic about the national economy — the highest in the 10 years of the survey — and 34 percent are optimistic about their local economy.

“The basic takeaway is that it looks really upbeat,” Adams said. “The economy in Ohio is strong.”

When it comes to tariffs, the results show a mixed attitude among business owners with about a third of owners favoring tariffs while a third opposed and the final third uncertain. About a third of those surveyed say they buy or sell items or services to other countries.