Business is Good and Hiring Rates to Increase Despite Economic Outlook According to the EAA 2023 National Business Trends Survey

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Results of the 2023 National Business Trends Survey from the Employer Associations of America (EAA)

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“The economy may be down, but business is good and we are seeing an increase in hiring. Those are all positives that we should be acknowledging as business leaders,” said EAA Board of Directors Chair Kevin Robins.

Business is Good and Hiring Rates to Increase Despite Economic Outlook According to the EAA 2023 National Business Trends Survey

While the current economic outlook may have business leaders proceeding with caution, according to the 2023 National Business Trends Survey from the Employer Associations of America (EAA), business is looking up with 59 percent of respondents expecting some type of increase in sales/revenue for 2023 (11% expect a significant increase and 48% expect a slight increase).

“The economy may be down, but business is good. And because business is good, we are seeing an increase in hiring. Those are all positives that we should be acknowledging as business leaders,” said EAA Board of Directors Chair Kevin Robins and CEO of MidAtlantic Employers’ Association (MEA). “We still have many challenges and uncertainties, but we are seeing business improvements worth noting.”

When executives were asked what they believe are the greatest challenges to their business in 2023, the top three responses were:
1. Talent acquisition
2. Talent retention
3. Cost of materials

Executives identified the following as their “serious” challenges for their business (short-term = within the next year):

  • Inflation (58%)
  • Talent acquisition (58%)
  • Talent retention (48%)
  • Ability to pay competitive wages/salaries (37%)
  • Cost of Materials (39%)

(Long-term = within the next five years:)

  • Inflation (51%)
  • Talent acquisition (50%)
  • Talent retention (45%)
  • Ability to pay competitive wages/salaries (37%)
  • Cost of Materials (36%)

Despite the cautious economic outlooks, executives still anticipate high hiring rates. While 34 percent of executives surveyed plan to maintain 2022 staffing levels in 2023, 61 percent of respondents said they plan to hire permanent staff in 2023. When asked the primary reasons for their hiring plans, 93 percent of respondents said they will be replacing staff due to voluntary turnover, and 71 percent will be hiring due to newly created jobs.

This past year, approximately 50 percent of executives reported that skilled professional staff (non-manager) positions are the most challenging when it comes to recruitment. To address recruitment challenges, the top three strategies survey respondents indicated that they have implemented are increasing starting salaries (75%), adjusting pay ranges upward (57%), and using temporary agencies, staffing agencies, or external recruiters (53%).

Thirty-five percent of respondents reported that skilled production workers and skilled professional staff (non-manager) are the most challenging job groups to retain. With retention being such a critical factor, the top strategies executives reported using include adjusting pay ranges (78%), providing additional training/development of existing staff (60%), and focusing on existing staff retention in jobs where recruitment is difficult (58%).

Executives were asked what they thought are the most important factors prospective employees are looking for. The top six responses in the 2023 survey include:
1. Competitive pay (86%)
2. Good work/life balance (76%)
3. Flexibility in work hours (62%)
4. Vacation/paid time off (36%)
5. Competitive/robust health benefits (33%)
6. Recognition and reward for good performance (31%)

Inflation was also taken into consideration in this year’s survey. For both 2022 and 2023, organizations indicated that increased starting rates are the top pay adjustment organizations have made or will make to account for higher wage demands due to inflation. Other actions employers will take in 2023 to address rising inflation include employee referral incentives (45%), adding features to employee benefits (23%), and offering remote work to reduce commuter expenses (21%).

The survey also asked what the top measures are that executives have been or are planning to continue to implement in 2022 and 2023 to strengthen business results. The top five are listed below (by top 2023 responses):

  • Invest in technology (45%)
  • Invest in equipment (43%)
  • Increase recruiting emphasis (36%)
  • Increase training budget (24%)
  • Implement formal employee engagement program (23%)

The EAA, a nonprofit national employer association, provides the National Business Trends as an annual survey to share information on what 1,167 organizations and executives did in 2022 and what they are planning to do for 2023 regarding the changing business climate. The report covers economic, business, and HR topics including:

  • Business Outlook
  • Business Investment Plans
  • Staffing Plans
  • Recruitment/Retention Challenges
  • Job Creation Challenges
  • Business Improvement Measures
  • Pay Strategies
  • Business Challenges

For a copy of the full report of the 2023 National Business Trends Survey, contact McKenna Arnold at
marnold@cascadeemployers.com | 503.585.4320

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About Employer Associations of America (EAA)
EAA consists of 27 regional employer associations serving 35,000 companies and more than six million employees. Regional employer associations are dedicated to serving their members as trusted partners that help members maximize the performance of their employees and their organization through business expertise in compliance, recruitment, retention, surveys, safety, training, and organization development. EAA’s mission is to advance a national presence and to promote local success among members through unparalleled collaboration, excellence, and efficiency. To learn more about the EAA, visit http://www.eaahub.org.

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Kathryn Klopfer
EAA
1 2626996342
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McKenna Arnold