“The rate of small business job growth is the same as April’s,” said Susan Woodward, the economist who worked with Intuit to create the Index. “But because compensation and hours dropped slightly, we can say the market for small business employment is a bit softer than last month. However, in light of recent tumult in Japan, Greece, and right here at home, it’s a comfort that small business employment continues to improve at all.”
Based on this latest data, the employment growth rate for April was revised slightly down to 0.2 percent, equating to 45,000 jobs added for the month. Since the hiring trend began in October 2009, small businesses have created 685,000 jobs.
Hours Worked, Compensation Dip
Small business hourly employees worked an average of 107.9 hours in May, making for a 24.9-hour workweek. This is a 0.13 percent decrease from the revised April figure of 108.1 hours.
“As small business employers react to economic pressures driven by such factors as rising gas prices and natural disasters, we see the job market soften,” Woodward said. “Employers cut back on employee hours when they have less work for people to do.”
Average monthly pay for all small business employees was $2,624 per month in May. This is a 0.14 percent decline compared to the April revised estimate of $2,628 per month. The equivalent annual wages would be about $31,500 per year, which is part-time work for many small business employees. Roughly 65 percent of small business employees are hourly, and only 27 percent of them worked more than 140 hours for the month in April.
“With small businesses assigning fewer hours to employees, average monthly pay declines too,” said Woodward. “Again, we see small businesses absorbing the shock of major events like natural disasters.”
Small Business Employment by Geography
The Intuit Index also breaks down employment by census divisions and states across the country.
“Job growth, although slow, continued in small businesses across most of the country in May,” said Nora Denzel, senior vice president and general manager of Intuit’s Employee Management Solutions division. “But the East South Central division, where severe flooding along the Mississippi River affected thousands of homes and businesses, showed job losses in May.”
Small Business Employment by U.S. Census Division continues to grow in most parts of the country except the East South Central division. The data reflects employment from approximately 64,000 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 all states in 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.
