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Small Business Digest



Finding the Right Employees Vexes Small-Business Leaders

While small-business leaders may be planning to add employees in 2011, they report a need to find the right kind of workers.

Responding to a national survey, respondents said it was difficult to recruit workers who were comfortable in a small-business environment.

The survey, by the University of Maryland’s Business School and Network Solutions, asked respondents how well they compete with other companies for good employees, and only 46% said they are successful. According to owners, employees best-suited for a small-business environment are those that have experience working in other small businesses and have a flexible mind-set and a broad skill set.

The good news is that U.S. small-business owners say they plan to add nearly 3.8 million jobs this year, according to the latest Small Business Success Index, released by the Center for Excellence in Service at the University of Maryland’s Robert H. Smith School of Business and partner Network Solutions LLC.

The semiannual index surveys small-business owners to measure the overall health of their businesses and understand how they are using technology.

When asked about their hiring plans for 2011, 28% of small-business owners surveyed said they expect to increase staffing by an average of two full-time employees. These owners report the main reason for the hires is to expand their businesses. But 69% of small-business owners expect no change in their staffing level. Only 2% expect to lay off workers.

Though less than a third of small-business owners plan to hire, the jobs they add could reduce the U.S. unemployment rate by 2.4 percentage points.

“Small businesses are the economic engine of the United States,” said Janet Wagner, director of the Center for Excellence in Service. “As they begin to hire again, owners need to focus on finding the right people to help grow their businesses. They need employees who understand customers’ needs and can provide the level of service that is so critical to the success of small enterprises.”

The Small Business Success Index also measures business owners’ overall optimism, which according to the results, is currently rated a “C-” at a score of 73. This is unchanged since the last index was captured in June 2010. Those surveyed report difficulty in accessing capital and challenges in marketing and innovation. The survey also measures how small-business owners are using technology, finding 31% are currently using social media, up from 24% a year earlier and 12% two years earlier.

The Small Business Success Index is measured with a telephone survey of 500 small-business owners across the U.S., conducted in January 2011. Total jobs small businesses plan to add is an estimate based on survey responses and Census Bureau data that there are nearly six million businesses in the U.S. with fewer than 100 employees. This is the fifth wave of the index since data were first collected in December 2008.

The full results of the index are available at

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