“The recovery that began late last summer for small businesses is still underway,” said Susan Woodward, the economist who worked with Intuit to create the Index. “While employment at the national level for all businesses is barely rising, small businesses are showing a more robust increase. This is in line with what we’ve seen with past recessions - small businesses are the first to hire when recovery begins.”
Based on this latest data, the employment growth rate for October was revised upward to 0.26 percent, equating to 51,000 jobs added for the month and a 3 percent annual growth rate. Since the growth trend first began in October 2009, small business jobs have increased by a revised estimate of 670,000.
Compensation Down, Hours Worked Flat
Total compensation per employee fell in November while hours worked were flat, compared to October.
Average monthly pay for all small business employees was $2,592 per month in November, a 0.3 percent decline from the revised October figure of $2,600 per month. This translates to wages of about $31,100 per year, which is part-time work for many small business employees.
“Compensation in small businesses has been down slightly over the last six months,” said Woodward. “Small businesses are hiring at a disproportionate rate right now compared to big businesses and are taking advantage of the soft labor market in a way that big businesses are not.”
Small business hourly employees worked an average of 105.9 hours in November, translating to a 24.4-hour work week. Hours worked remained flat for November following a sharp rise in hours worked in October.
“It’s good to see that hours worked are still high despite a relatively strong rise in employment,” added Woodward. “This means that small businesses are busy. Even though they are hiring more people, they haven’t reduced the hours of their hourly employees.”
Small Business Employment by Geography
The Intuit Index also breaks down employment by census divisions and states across the country.
“The West North Central division continued to see job losses while all other divisions continued to show employment growth,” said Cameron Schmidt, vice president of Intuit’s Employee Management Solutions division. “It’s also good to see that states like Arizona, Massachusetts, New Jersey and Virginia all have strong increases in employment.”
Small Business Employment by U.S. Census Division continues to grow in most parts of the country except for the West North Central and Mountain divisions. The data reflects employment from approximately 59,000 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 with the highest increases in Massachusetts, Arizona, New Jersey and Virginia. 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.
