In what could be prompted by fears of a possible recession, a survey shows Illinois small businesses are putting a freeze on hiring.
The business network Alignable asked small businesses in Illinois and around the country about their hiring practices during March. Head researcher Chuck Casto said Illinois saw the largest hiring decline in the country.
“Illinois small businesses went from the top of the chart in terms of hiring, things were looking really good last month, to the bottom of the chart where they are down 28 percentage points,” said Casto.
Casto said many respondents said they are hedging their bets, trying to protect themselves from an uncertain economic environment.
The survey showed more small business owners nationwide are shifting from permanent, full-time hiring and moving toward employing temporary, part-time workers and contractors instead. The rate of hiring temporary part-timers or contractors soared to a record high 25% in March. In Illinois, the rate was 21%.
The industries with the most gains in March in part-time or contractor hiring were agriculture, travel and restaurants.
Other statistics support these worries, including that 60% of small business owners fear a recession is imminent. Add that March revenues were lower than expected, and 38% said they couldn’t cover their rent last month.
The March jobs report showed hiring slowed last month but likely not enough to spur another interest rate hike.
The U.S. economy added 236,000 jobs in March while the unemployment rate fell to 3.5%. The unemployment rate in Illinois is 4.5%.
Still, economists see March’s job numbers as a beginning to a period of slower growth for the country’s labor market.
“With the sharp fall in job openings and upward trend in jobless claims also pointing to a cooling in labor demand, and the drag from the recent banking turmoil still to feed through, we expect employment growth to slow more sharply soon,” wrote Andrew Hunter, deputy chief economist at Capital Economics.
***Courtesy of the Illinois Radio Network***
