By Sarah E. Needleman; Wall Street Journal

Small-business hiring continues to show little sign of a recovery, despite recent efforts by Washington to stimulate job creation.

April marked the 27th consecutive month in which small businesses either shed more or the same number of jobs that they added, according to a monthly survey to be released Tuesday by the National Federation of Independent Business, a trade group in Washington, D.C. Since July 2008, employment per firm has fallen steadily each quarter, logging the largest reductions in the survey's 35-year history. Going forward, more small-business owners say they plan to eliminate jobs compared with those that expect to create new jobs over the next three months.

The latest study was conducted during the month of April and reflects responses from 2,197 U.S. small-business owners. The findings follow the Labor Department's report on Friday showing that the overall U.S. economy added 290,000 jobs last month, although the unemployment rate ticked up to 9.9% from 9.7%.

Last month, businesses that employ fewer than 50 workers increased their payrolls by just 1,000, while businesses with between 50 and 499 workers added 17,000 jobs, according to payroll company Automatic Data Processing Inc.

William Dunkelberg, chief economist for the NFIB, says more small businesses aren't hiring because demand for their goods and services isn't yet strong enough for them to justify bringing new talent on board. "If you don't have any sales, you don't need to hire anybody," he says. (See related article, "Entrepreneurs Remain Wary.")

In March, President Obama passed legislation offering two new tax credits designed to encourage employers to hire unemployed workers or individuals only working part time. One exempts employers from their 6.2% share of the Social Security tax on wages paid to qualifying employees between March 19 and Dec. 31 of this year. A new hire retention credit is worth up to $1,000 for every unemployed worker hired between Feb. 3, 2010 and Jan. 1, 2011 and retained for at least 52 consecutive weeks.

But such incentives still aren't prompting some small businesses to create jobs. According to a survey conducted last month of 300 small-business owners from Intuit Inc., a maker of accounting software in Mountain View, Calif., just 20% said the payroll tax credit was driving their interest in hiring.

At Jones & Carter Inc., a small Houston engineering firm, tax credits "will do absolutely nothing to inspire us to hire someone," says founding partner James Robert Jones. The firm has shed about 25% of its work force since 2007 due to sagging revenues. "We'd love to bring all of [the positions] back and add more, but until the market is there, we can't grow," he says. "We're tied to a market that is stagnant right now."

Even businesses that are hiring are doing so cautiously because "growth can come in fits and spurts," adds E.J. Reedy, manager of research and policy at the Ewing Marion Kauffman Foundation, a nonprofit focused on entrepreneurship in Kansas City, Mo. "Small businesses are being very selective in how they bring back employees."

Moda3 LLC, a snowboard and accessories retailer in Milwaukee, has seen sales decline by 30% over the past two years, forcing it to lay off 12 workers, says Keith Lipski, manager. The eight-employee company has no plans to refill many of the positions that were cut, he adds. "We've streamlined the way we do things," Mr. Lipski says. "We used to have five people packing orders and now we have just one."