The NFIB Research Center released its monthly jobs report, showing the small business labor market has further weakened in June. Firms reduced employment by 0.28 workers per firm over the past month, weaker than the decrease of 0.17 workers per firm in May. Unchanged from last month’s report, 6 percent reported increasing employment an average of 2.6 workers per firm and 22 percent (up one point) reported reducing employment an average of 4.6 workers per firm (seasonally adjusted).

“As states change reopening rules and dates, sometimes easing restrictions, small businesses are feeling various levels of uncertainty as to what comes next,” said NFIB’s Chief Economist Bill Dunkelberg. “With recent COVID-19 spikes in some cases, many state governments are reversing prior decisions and reducing the potential for small business to earn needed revenue.”

Some small business owners are cutting payrolls as Paycheck Protection Program (PPP) loan borrowers are moving through their eight-week forgiveness period. The forgiveness terms for the PPP loans generally require owners to keep payrolls at pre-crisis levels except under certain conditions. Many owners received their loans in April and will be unable to keep all their workers past June.

A seasonally adjusted 16 percent plan to create new jobs in the next three months, up 8 points from May. As states begin to reopen, owners are planning to re-hire workers as they open their business or expand business operations.

Also seasonally adjusted, 32 percent of all owners reported job openings they could not fill in the current period, up 9 points from May. Fifty-one percent of owners reported hiring or trying to hire in June and 84 percent of those hiring or trying to hire reported few or no “qualified” applications for the positions they were trying to fill, up 6 points.

Fifty percent of construction firms reported few or no qualified applicants and 30 percent cited the shortage of qualified labor as their top business problem.

Up 7 points from last month, 27% have openings for skilled workers and 11% have openings for unskilled labor (up 1 point). Twenty-three percent of owners reported few qualified applicants for their open positions (up 4 points) and 20 percent reported none (up 2 points). Forty-one percent of the job openings in construction are for skilled workers.

Fewer owners raised compensation than in previous months with less upward pressure on wages created by the massive level of layoffs and terminations. Seasonally adjusted, a net 14 percent reported raising compensation (unchanged) and a net 13 percent plan to do so in the coming months (up 3 points). Eight percent of owners cited labor costs as their top business problem.

View the full jobs report here.