Small business employment index indicates 57,000 jobs created in Decemberby
Small business employment continued to show growth in December with an increase in hours worked and wages flat, according to the most recent Small Business Employment Index by Intuit Inc.
The monthly report found that small business employment grew by 0.3 percent last month, equating to an annual growth rate of about 3.4 percent. This translates to approximately 57,000 new jobs created nationwide. The index is based on figures from the country's smallest businesses that use Intuit Online Payroll.
"Small business is still the most vigorous sector of the employment picture", said Susan Woodward, the economist who worked with Intuit to create the index. "We generally see a rise in employment for all businesses in December, but this year it is unusually strong. We can hardly see the recovery in overall national employment, but, among small businesses, the recovery, albeit slow, is unambiguous."
Based on this latest data, the employment growth rate for November was revised upward to 0.4 percent, equating to 73,000 jobs added for the month, and a 4.4 percent annual growth rate. Since the growth trend first began in October 2009, small business jobs have increased by a revised estimate of 880,000.
Total compensation per employee was flat in December while hours worked were up, compared with November.
Average monthly pay for all small business employees was $2,607 per month in December, a nearly 0.1 percent decline, which is considered flat, from the revised November figure of $2,609 per month. This translates to wages of approximately $31,300 per year, which is part-time work for many small business employees.
"The weakness of the overall employment picture is still reflected in small business compensation", Woodward said. "Though small businesses are hiring and asking their people to work longer hours, they don't have to pay more to get people. While compensation is flat, these numbers don't mean that people didn't get overtime and bonuses in December – they did. But on a seasonal and trend adjusted basis, compensation is not up."
Small business hourly employees worked an average of 107.5 hours in December, translating to a 24.8-hour work week. This is a nearly 0.2 percent increase from the revised November figure of 107.3 hours.
"Hours are still strong", added Woodward. "We might expect that after months of high hours per employee, that businesses would hire and hours would fall back to normal. Instead, we see hiring up and hours worked up also. These are good signs for the recovery."
The index also breaks down employment by census divisions and states across the country.
"All divisions continued to show employment growth except for the West North Central division, which continued to see job losses for the sixth month in a row", said Cameron Schmidt, vice president of Intuit's Employee Management Solutions division. "Most states saw increases in employment with Washington seeing the strongest increase month over month."
Percent change in employment
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.
About the Index:
The Intuit Small Business Employment Index is based on aggregate and anonymous online employment data from nearly 60,000 small business employers, each with fewer than 20 employees. These small businesses use Intuit Online Payroll.
About Intuit Inc.:
Intuit Inc. is a provider of business and financial management solutions for small and mid-sized businesses; financial institutions, including banks and credit unions; consumers and accounting professionals. Follow Index News on Twitter: #SMBindex; Intuit on Twitter: www.twitter.com/Intuit.