The labor department reported last week that unemployment applications increased by 6,000 to a seasonally adjusted 401,000. The news has many business owners fearing the economic slump is continuing. Rates need to fall below 375,000 to signal the healthy growth of the economy.
On Friday, the Labor Department will release rates for the month of September. So far so good, actually, since unemployment in 2010 averaged 459,000. Significantly, current numbers at 401,000 show less people are currently on unemployment than in 2010. As the economy indicates, with an unemployment rate of 9.1% we are still in a bit of a crisis. The question many of are asking is what should be done about small business. Does it make sense to hire, or fire, if the economic numbers indicates we’re still in a decline?
On the cusp of economic recovery, the talent pool for many jobs is still excellent. If you are part of a specialized small business, it may make sense for you to hire. You should consider that the high unemployment rate makes shopping for the right candidate a real bargain. You may have the option of hiring someone with all the skills you need for less money.
The other factor? Employees who were laid off by large corporations may be more likely to accept lower rates. If you think your small business could benefit from hiring a professional, like a Chief Financial Officer, start interviewing. Middle management is often the hardest professional rank hit by lay-offs. The most sage advice in business may be to find a way to keep the right talent, as well. Having someone whose specialized skills fit your business can increase your profits once your business finances turn around.
From a bleak angle, the Federal Reserve suggests the economy is growing more slowly than expected. Should you consider firing someone? If you see signs that your small business isn’t able to reach previous sales to support an extra staffer, it may be time to get out the ax. It also may be time to consider who’s pulling their weight and who’s not. The recession recovery is a good time to assess who truly contributes to you business success. If you weren’t quite sure how, or why, to give the boot to a questionable employee, the sour economy gives you reason enough.
The news, of course, isn’t exactly inspiring. Many of us were hoping the economy would have a continued positive upswing. As a small business, you do need to be prepared to cut your losses. Otherwise, if you’re still comfortably holding your own, there’s probably a well educated, experienced employee just waiting to join the right team, and at a lower rate of pay than a big corporation would offer.