Since the hiring trend began in October 2009, small businesses have created 820,000 jobs. The Index is based on figures from small businesses with fewer than 20 employees that use Intuit Online Payroll.
Based on these latest numbers and revised national employment data from the Bureau of Labor Statistics, the employment growth rate reported for May was revised slightly up to 0.3 percent from 0.2 percent, equating to 60,000 jobs added for the month.
“The small business employment figures we follow look more hopeful this month,” said Susan Woodward, the economist who worked with Intuit to create the Index. “Employment is up. Hours worked are up. Compensation and the hourly wage are up, and also the fraction of hourly people working full time is up. Even the hiring rate, which has been flat for a long while, is up a bit. The progress is pretty much national, not confined to just some regions. At the same time, the revised numbers for May look better than we thought so altogether there is more cause for optimism.”
Hours Worked, Compensation Slightly Up
Small business hourly employees worked an average of 108.7 hours in June, making for a 25.1-hour workweek. This is a 0.2 percent increase from the revised May figure of 108.4 hours.
“It’s good to see an increase in the number of hours worked,” Woodward said. “Last month I was worried when hours worked dipped slightly, so it’s reassuring to see this increase. It’s not clear what’s driving this rise. Other data shows a recovery in both monthly revenues and monthly income for industries involved in a particularly troublesome sector – housing, including construction and real estate services. These recoveries are consistent with house prices rising, nationally, for the first time in many months.”
Average monthly pay for all small business employees was $2,643 per month in June. This is a 0.2 percent increase compared to the May revised estimate of $2,638 per month. The equivalent annual wages would be about $31,700 per year, which is part-time work for many small business employees. Roughly 65 percent of small business employees are hourly, and 29.6 percent of them worked more than 140 hours for the month in June, up from 27 percent in May.
“Compensation increased this month, enough to move the seasonally adjusted trend to a clear positive region,” said Woodward. “Again this is reassuring after seeing little change in compensation for the last few months.”
Small Business Employment by Geography
The Intuit Index also breaks down employment by census divisions and states across the country.
“We continue to see solid progress in small business job growth across most of the country, with only a slight decline in the East South Central region,” said Nora Denzel, senior vice president and general manager of Intuit’s Employee Management Solutions division. “Maryland shows a slight decline in small business employment, but it’s so small that it’s not particularly worrisome. We also added one more state, Pennsylvania, to our state data, which shows a slight increase in small business employment for June.”
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 66,000 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 most 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.
