By Kim Mercado for NEXT

More than 66% of small businesses said attracting the right talent in the next six months will be somewhat or very difficult

17% of small business owners cite lack of skilled applicants as the main challenge

Many small business owners are ready to expand their teams. But a NEXT research study found that most expect hiring new employees to be a challenge. And many are successfully attracting new talent with new strategies that work. In April 2025, we asked 1,500 small business owners looking to hire in the next six months for their thoughts about finding and bringing on more workers. The data reveals a difficult hiring landscape, including tough competition and a shortage of skilled applicants.

Demand for more workers is strong and evolving
Nationwide and across business sectors, small business owners are actively hiring for many roles to stay nimble and meet demand. According to our report, 22% plan to hire full-time staff, 17% seek part-time help, and others are eyeing seasonal workers (14%) and contract roles (12%).
According to Ernst & Young’s 2024 Work Reimagined Survey, flexible work is becoming more of a norm. Organizations are shifting from rigid, full-time hiring toward more adaptable project-based and contract roles that adapt to changing workloads and economic uncertainty. The report also notes that skills-based hiring — rather than traditional degree requirements — may help close the gap between available talent and job demands.

Hiring demand is high, many find that talent is scarce
From niche software skills to handling pressure in fast-paced roles, the bar for qualified candidates is high. As demand outpaces supply, small business owners report that finding people who truly fit the job has become more complex.
Coviello puts it bluntly: “I currently need two project managers and it’s proving to be more difficult than it was last year. There are a lot of candidates, but finding somebody who can handle pressure and know software is rare.”

This signals a skill mismatch between open roles and available talent. Hiring isn’t just filling seats; it’s about finding people who can contribute, keep up and stick around.
What makes hiring so difficult?
In our research, the main reason small business owners cite for the challenges in hiring is the lack of skilled applicants (17%). Others said they struggle to compete because they don’t offer benefits (13%), other jobs in the area are more alluring (11%) or they can’t match local wages (11%). Another 10% report that unemployment is low in the area where they do business.

Situational Awareness: Small businesses are changing how they hire. With flexible work locations, personal referrals and better internal systems, many business owners have found that the best way to compete for talent might not be outspending — it’s outthinking.
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