U.S. Small Business Job Growth Shows Positive Gains, While Wage Inflation Decelerates
June 04 2024 - 8:30AM
Business Wire
Weekly earnings growth increases as weekly
hours worked stabilize
According to the Paychex Small Business Employment Watch, the
Small Business Jobs Index rose 0.46 percentage points to 100.58 in
May, the largest one-month increase since January 2022. At the same
time, hourly earnings growth slowed to 3.13%, its lowest level
since June 2021, for workers in U.S. small businesses with fewer
than 50 employees. The report also indicated that weekly earnings
growth was above three percent (3.09%) for the first time since
January 2024 due to positive momentum in weekly hours worked by
employees in May.
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The Paychex Small Business Jobs Index
rose 0.46 percentage points to 100.58 in May, the largest one-month
increase since January 2022. (Graphic: Business Wire)
“It appears we are seeing a stabilization in job growth and
continued downward pressure on hourly wages,” said John Gibson,
Paychex president and CEO. “Yet, challenges still remain for small
business owners given concerns over inflation, access to capital,
and a shortage of labor and skills.”
“Small business owners in most sectors scheduled workers for
more hours in May, which resulted in increased weekly earnings,”
Gibson added. “Following a long-term trend of decreasing hours
worked for small business employees, there are early signs of a
turning point, moving towards stabilization.”
Jobs Index and Wage Data Highlights:
- The national jobs index increased 0.46 percentage points to
100.58 in May, the largest one-month gain in more than two years.
Despite the 0.46 percentage point increase in May, the national
jobs index was down 0.09 percentage points during the past three
months.
- At 100.58, the national jobs index showed modest employment
gains, though at a slower pace than last year (0.78 percentage
points).
- All regions improved their rate of employment growth in May,
led by the Midwest with a one-month increase of 0.61 percentage
points to an index level of 100.94. With an index of 101.05, the
South has been the fastest-paced region for small business
employment growth for 19 of the past 21 months.
- Following eight-straight decreases, the Leisure and Hospitality
sector increased 0.77 percentage points to a 100.26 jobs index in
May, marking the largest one-month gain since February 2023.
- Hourly earnings growth for workers slowed to 3.13% in May, the
lowest level since June 2021 (2.90%), and resumed the downward
trend of the past two years.
- One-month annualized hourly earnings growth was 2.11%, more
than one percent below the year-over-year rate and the lowest level
since November 2020 (1.74%).
The complete Small Business Employment Watch results for May
2024, including interactive charts detailing the data at a
national, regional, state, metro, and industry sector level are
available at www.paychex.com/watch. Learn more and sign up to
receive monthly Employment Watch alerts.
About the Paychex Small Business Employment Watch
The Paychex Small Business Employment Watch is released each
month by Paychex, Inc. Focused exclusively on businesses with fewer
than 50 workers, the monthly report offers analysis of national
employment and wage trends and examines regional, state, metro, and
industry sector activity. Drawing from the payroll data of
approximately 350,000 Paychex clients, this powerful industry
benchmark delivers real-time insights into the small business
trends driving the U.S. economy. The jobs index is scaled to 100,
which represents no year-over-year change in job growth among same
store businesses. Index values above 100 represent new jobs being
added, while values below 100 represent jobs being lost.
About Paychex
Paychex, Inc. (Nasdaq: PAYX) is an industry-leading HCM company
delivering a full suite of technology and advisory services in
human resources, employee benefit solutions, insurance, and
payroll. The company serves approximately 740,000 customers in the
U.S. and Europe and pays one out of every 12 American private
sector employees. The more than 16,000 people at Paychex are
committed to helping businesses succeed and building thriving
communities where they work and live. Visit paychex.com to learn
more.
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version on businesswire.com: https://www.businesswire.com/news/home/20240604606746/en/
Media Tracy Volkmann Paychex, Inc. Manager, Public
Relations (585) 387-6705 tvolkman@paychex.com @Paychex Colleen
Bennis Matter Communications Account Director (585) 666-9510
cbennis@matternow.com
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