In November 2020, the Employer Associations of America (EAA) published their 2021 National Business Trends survey, coordinated by Cascade Employers Association, and made possible by the collaborative efforts of employer associations nationwide, including Archbright.
The survey includes 1,484 distinct participating organizations across all industries and all 50 states, as well as Washington D.C. The participants ranged in size, with the majority from smaller companies with 1-99 employees. Other participant information includes:
The top industries represented were Manufacturing of Durable Goods (27%), Professional, Scientific, & Technical Services (11%), and Healthcare and Social Assistance (11%).
Employers face the daily challenge of keeping their businesses thriving in a continuously changing environment—everything from attracting and retaining talent, to managing complex regulations and laws, to staying ahead of the competition.
The 2021 National Business Trends survey provides insight into how business executives responded to the challenges of 2020 and their plans for 2021 in the following areas:
While the full report includes six sections, a national report, four regional reports (Midwest, Northeast, Southern, & Western), and individual state reports, we are going to take a closer look at some of the trends from the national report, and a comparison of results from the states here in the Pacific Northwest.
Somewhat surprisingly, the survey results show a fair amount of optimism among business executives. Executives expect the overall outlook for the 2021 economy to be improving (44%) or staying the same (33%) compared to 2020.
Executives report the greatest challenges to business growth are talent acquisition (38%), talent retention (28%), and competition (27%). Other serious challenges to businesses include:
When it came to the most challenging positions to recruit for, 39% of executives reported skilled production positions are the most difficult, 38% reported professional staff, and 26% reported middle management.
The top three strategies used to address recruitment challenges include increasing starting salaries, starting/growing social media use for recruiting, and moving interview/training to online/remote meetings.
64% of the executives reporting are planning to provide a wages/salary increase in 2021, which is good news. And while 22% indicated they froze or redlined all positions’ wages/salaries in 2020, only 5% plan to do the same in 2021.
The top three measures to strengthen business results that executives say they have been doing or are planning for 2021 are:
And of course, it could not be a 2020/21 survey without a COVID-19 component. Most employers (77%) are still either extremely, moderately, or somewhat concerned about COVID-19 and its impact on human resources (policies, remote work, employee absences, etc.). 78% are also either extremely, moderately, or somewhat concerned about COVID-19’s impact on business continuity.
The top five measures business are planning to implement or continue doing to address COVID-19 are:
For the most part, the survey results for the states of Washington, Idaho, and Oregon were on par with the national results, with few exceptions, most of which can be explained by the types of industries represented and the size of the companies.
Washington had 76 respondents, with the largest percentage represented by:
76% of the participants were from companies with less than 249 employees. 78% of respondents were from for-profit, privately held companies.
The state of Idaho had 21 respondents, with the top three industries represented by:
57% of participants were from companies with over 250 employees, and 100% of respondents were for-profit, either privately held or publicly traded.
Oregon had 68 respondents, with the top three industries represented by:
Most respondents were from smaller companies, with 75% being for-profit, privately held and 16% being not-for-profit/non-profit organizations.
Each of these three states described their overall projected business outlook for 2021 as a “slight increase in sales/revenue or budget.”
In 2020, Washington appeared to suffer the most, with 28% of respondents indicating their expected business results for 2020 to be a significant decrease in sales/revenue or budget compared to 2019. This is not a surprising result, given the industries represented and the hit taken to the aerospace sector alone.
The job outlook appears to be mostly optimistic, with a large percentage of respondents either maintaining staffing levels (Washington – 49%, Idaho – 43%, Oregon – 49%) or hiring permanent staff (Washington – 42%, Idaho – 52%, Oregon – 40%).
Yet, similar to the national reports and as indicated earlier, recruitment continues to be challenging for businesses. The most difficult positions to hire for were in line with the national results – skilled production, professional staff, and middle managers.
The strategies to address the recruitment challenges were very similar amongst the three states with starting/growing social media use and moving interviews/training to online/remote meetings were top answers for each state, but there were notable differences:
With regards to what prospective employees are looking for, while the order may vary a bit, all three states had the same top 5 factors:
This list has changed a bit over the years and is not surprising given how many people are now working remotely and are likely enjoying more work/life balance or finding that they need more work/life balance. As competitive pay continues to be at the top of the list, variable pay strategies are essential. Types include employee referral bonuses, year-end bonuses, individual incentives, spot bonuses, and sign-on bonuses.
Regarding compensation, most employers intend to increase wages and salaries in 2021, which is good news for employees across the PNW and the nation.
Regarding COVID-19 and its ongoing impact, all three states had very similar responses when asked about its impact on human resources, all indicating they continue to be moderately concerned.
However, when it came to COVID-19 and its ongoing impact on business continuity, Idaho respondents indicated a more significant concern, with 87% of respondents indicating they are somewhat, moderately, or extremely concerned about business continuity. A likely explanation for this difference is the greater representation of Idaho’s responses from the financial & insurance industries. Washington and Idaho also appear to be more concerned with COVID-19’s impact on business/capital spending. And lastly, COVID-19 strategies in all three states were essentially the same as the national report.
For more detailed information on what executives are doing to address the changing business climate, the entire 2021 National Business Trends Report is now available for purchase on Archbright.com. Archbright Bronze, Silver, or Gold Members who participated in the survey received the report for free.