Small businesses plan to hire this year, but cautiously

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The recession has been a lesson in resiliency for all of us. To get through these tough economic times we’ve adapted to less-than-ideal situations, pushed ourselves out of our comfort zones and pulled off bigger career reinventions than Mark Wahlberg (From Marky Mark to “The Fighter?” All we can say is “wow”).

Small businesses are no exception to the resiliency rule. Many small business owners were pushed to the limit — their creativity and persistence determining whether or not they survived the past few years. Many had to make do with less — far less — than in previous years, and find innovative solutions to meet staffing and financial needs.

Now, with the economy finally beginning to recover, many small businesses (those with 500 employees or less) do plan to increase their headcounts this year, but plan to do so cautiously. Of the more than 1,350 small business owners polled in CareerBuilder’s annual survey of small business hiring trends, 51 percent say they are in a better financial situation than they were one year ago, though  only 21 percent anticipate hiring full-time employees this year. While still modest, that number is up from 20 percent in 2010 and 15 percent in 2009.

For those who can’t afford to add more full-time staff, but still have personnel needs, contract workers are the next-best thing. To prevent employee burnout and maintain productivity levels, 26 percent of small business owners plan to hire contract or temporary workers in the coming year, with 31 percent reporting that they may transition these workers into full-time positions.

Slightly fewer respondents said they’d meet staffing needs with part-time help. According to the survey, 11 percent of small businesses plan to hire part-time employees this year, up from 9 percent last year and 8 percent in 2009.

Despite a general increase in hiring this year, it’s clear that small business owners still have some reservations when it comes to hiring.

According to the survey, some of the biggest challenges employers face are:

  • Cost of health insurance — 50 percent
  • Access to credit — 33 percent
  • Government regulations — 27 percent
  • Marketing expenses and building awareness — 26 percent
  • Attracting and hiring top talent — 19 percent

While access to credit was the second most-cited issue, it also seemed to be the most important determinant of a small business employer’s ability to hire. Sixty-six percent of respondents that said they received the credit they needed last year were able to hire new employees.

Matt Ferguson, CEO of CareerBuilder, says that alleviating some of these stressors on small businesses over the next year will play a big part in the overall health of the job market. “Small businesses are a major driving force behind job creation in the U.S. and play a vital role in economic growth … Over the last year, we saw modest, but continued gains in jobs that are carrying over into 2011. Before we see people back to work in greater numbers, we need to find ways to get this segment of the economy hiring again,” he says.

Do you work for a small business? Do you think your company could use extra staff? Do you prefer to work for small companies? Let us know in the comments section, below.

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