Small Businesses Are Hiring Again. They're Not Paying More to Do It.
NFIB's June survey found more Main Street owners trying to fill jobs than in May. Fewer of them raised pay to do it. Normally those two lines move together.
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In May, labor costs were the single most-cited headache on NFIB's monthly survey of small-business owners — the highest share the group had recorded. By June, that number had dropped six points. Only 8% of owners now call labor costs their top problem.
You'd expect that to mean hiring cooled off. It didn't.
NFIB's June jobs report, released July 2 and built from a survey of 405 member firms taken through June 29, found the opposite. Job openings owners couldn't fill climbed to 32%, up three points from May. Sixty-two percent of owners said they'd hired or tried to hire during the month, up seven points. A net 11% plan to add jobs over the next three months. Openings went up. Pay pressure went down. Those two things aren't supposed to move in opposite directions at once — a tighter labor market is usually the thing that pushes wages up, not down.
The hiring didn't get any easier
Here's the part that keeps this from reading as pure good news for owners: the workers still aren't easy to find.
Fifty-one percent of owners who hired or tried to hire in June said they got few or no qualified applicants — up five points, and the highest that figure has been since September 2024. Nineteen percent named labor quality or availability as their single biggest problem, up six points. Openings for skilled workers held flat at 27%. Openings for unskilled labor rose three points, to 12%.
So the shortage of qualified people didn't ease. What eased was owners' willingness, or ability, to pay more to solve it. A seasonally adjusted net 28% of owners reported raising compensation in June — down three points, and the lowest reading of the year. A net 17% plan to raise pay over the next three months, down one point.
What the index itself says
NFIB's broader Small Business Employment Index sat at 100.2 in June, essentially flat against May's 100.3. That's the fourth straight month it's declined. It's still below the 2025 average of 101.2, though slightly above NFIB's long-run historical average of 100.0 — a baseline the group set from decades of prior surveys, not a target or a magic number.
NFIB's chief economist, Bill Dunkelberg, framed the report as owners cautiously re-engaging: hiring appetite is coming back after May's dip, but the applicant shortage that's dogged Main Street for two years hasn't gone anywhere. We're paraphrasing that framing rather than quoting it directly — two outlets that covered the release worded his comment differently enough that we didn't trust either version as verbatim, and NFIB's own release page didn't give us a clean quotation to check against.
One thing we went looking for and couldn't find: any explanation, from NFIB or anyone covering the release, for why compensation plans cooled at exactly the moment hiring appetite rose. That combination runs against the usual playbook, where a tighter market for workers pushes pay up, not down. Nobody we read addressed it directly. It's an open question, not one this report answers.
What This Means for You
If you're looking for work: more small businesses trying to hire is good news on its face, but the 51% figure on qualified applicants suggests plenty of these openings are asking for skills or experience that a lot of applicants aren't bringing. If you're job hunting, the gap right now looks more like a skills match problem than a headcount problem.
If you own or run a small business: the pressure to raise pay just to keep a job posting competitive appears to be easing, which is real relief if you've spent the last two years watching payroll checks get bigger every quarter. That relief doesn't fix the harder problem — half of the owners trying to hire still aren't finding anyone qualified, and an unfilled seat has its own cost even when you're not raising anyone's wage to fill it.
Sources
- NFIB, "NFIB Jobs Report: Small Business Job Openings Rebound" — July 2, 2026
- NFIB, "Job Openings and Hiring Plans Rebound In June, Compensation Pressures Cool" — Jobs Report, survey through June 29, 2026 (n=405)
- ROI-NJ, "NFIB June Jobs Report: Small Business Job Openings Rebound From Lowest Level Since May 2020" — July 6, 2026
- Alabama Reporter, "National Federation of Independent Business Releases June Jobs Report" — July 3, 2026
Disclaimer: This article is news and general information only, not financial, hiring, or legal advice. Figures reflect NFIB's June 2026 member survey and may be revised in later reports.