“This month’s report is a lot like last month’s,” said Susan Woodward, the economist who worked with Intuit to create the Index. “Small businesses are hiring and their people are working more hours, but measures of compensation are pretty flat, showing that the labor market is still soft. While the rise in employment is good news, this rate of increase is still not going to get us back to full employment very fast.”
Based on this latest data, the employment growth rate for January was revised down slightly to just under 0.3 percent, equating to 60,000 jobs added for the month and a 3.5 percent annual growth rate. Since the growth trend first began in October 2009, small business jobs have increased by a revised estimate of 800,000.
The time to hire has arrived for many small business owners including Amber Schweitzer, owner of PEP Club Sports in Parker, Colorado: “I’m currently the only paid employee. We’ve outgrown our location and are expanding to more sites to accommodate more sports. I need to hire site managers to run the other venues. I haven’t slept in weeks because of worrying about this.”
Hours Worked Up; Compensation Flat
Small business hourly employees worked an average of 107.6 hours in February, translating to a 24.8-hour work week. This is a 0.1 percent increase from the revised January figure of 107.5 hours.
“Hours worked continue to go up, which is another good sign,” Woodward said. “Based on other analysis we have done on the data, we think that we are seeing higher hours because small businesses are increasing the fraction of their hourly workers who work full time. Hours worked are up about 3 percent over the last year.”
Average monthly pay for all small business employees was $2,612 per month in February, a 0.1 percent decrease, which is essentially flat, compared to the January revised estimate of $2,614 per month. This translates to wages of about $31,300 per year, which is part-time work for many small business employees.
“Compensation and the hourly wages for hourly workers are essentially flat as they were last month, and have been for a year,” continued Woodward. “This is a sign that the labor market is still soft. Small businesses are hiring, but they do not have to pay up to get people.”
Small Business Employment by Geography
The Intuit Index also breaks down employment by census divisions and states across the country, with growth in most regions.
“All divisions continued to show employment growth except for the West North Central division, which has not seen growth for eight months in a row,” said Cameron Schmidt, vice president of Intuit’s Employee Management Solutions division. “Most states saw increases in employment, with slight decreases in Georgia, New York and North Carolina.”
Small Business Employment by U.S. Census Division continues to grow in most parts of the country except for the West North Central division. The data reflects employment from approximately 60,000 small business employers who use Intuit Online Payroll. The month-to-month changes are seasonally-adjusted and informative about the overall economy.
Small Business Employment by State is up for many states across the country. The states above reflect those for which Intuit Online Payroll has more than 1,000 small business firms represented. The month-to-month changes are seasonally-adjusted and informative about the overall economy.
