ROCHESTER, N.Y., April 4,
2023 /PRNewswire/ -- Small business employment has
grown consistently during the first quarter of 2023, according to
the Paychex | IHS Markit Small Business Employment Watch. The Small
Business Jobs Index, which measures employment growth, increased
modestly (0.06%) from the previous month to 99.73. The March report
also showed average hourly earnings increased slightly from the
previous month to 4.64 percent.
"The small business economy continues to demonstrate durability
with the jobs index advancing each month this year along with
moderate wage gains," said James
Diffley, chief regional economist, S&P Global Market
Intelligence.
"The Main Street small- and mid-sized business owners continued
to show their resiliency in the first quarter of 2023," said
John Gibson, Paychex CEO. "This
is an encouraging start to the year and policymakers are going to
need to carefully consider their next actions as the full impact of
the recent banking disruptions on SMB's access to capital is still
not fully understood."
In further detail, the March report showed:
- Following several months of moderation, national hourly
earnings growth increased slightly to 4.64 percent in March as
one-month annualized growth reached 5.34 percent.
- The national jobs index has risen for three consecutive months,
with the South's growth—the only region with an index above
100—continuing to lead the country.
- Weekly hours worked rose 0.21 percent YOY (to 32.63) while
one-month annualized growth moderated for the first time since
August 2022.
- The South led regions for the twelfth consecutive month and is
the only region with an index above 100 (100.68). Still, the South
reported its first decrease (-0.14 percent) since September 2022.
- Despite its job growth slowing by 0.42 percent, North Carolina's robust performance continued
in March, with the state's index hitting 102.13.
- Illinois' growth rate rose
0.25 percent last month and 1.70 percent year-over-year. At 101.92
and second among states, Illinois'
performance in March is the strongest it's seen since
2014.
- Small business employment growth remained strong in
Houston (103.10), making the city
the first among metros for the fifth consecutive month.
- Leisure and hospitality led sectors in jobs growth (101.32) and
hourly earnings growth (5.96 percent).
Paychex solutions reach 1 in 12 American private-sector
employees, making the Small Business Employment Watch an industry
benchmark. Drawing from the payroll data of approximately 350,000
Paychex clients with fewer than 50 employees, the monthly report
offers analysis of national employment and wage trends, as well as
examines regional, state, metro, and industry sector activity.
The complete results for March, including interactive charts
detailing all data, are available at www.paychex.com/watch.
Highlights are available below.
National Jobs Index
- At 99.73, the pace of small business employment growth
increased 0.06 percent in March and 0.35 percent during the first
quarter of 2023.
- Despite consecutive gains in the first three months of 2023,
the national Index is down 1.55 percent from a year ago.
National Wage Report
- Following several months of moderation, national hourly
earnings growth increased to 4.64 percent in March and one-month
annualized growth reached 5.34 percent.
- At 32.63 hours, weekly hours worked were up
year-over-year (0.21 percent), though one-month annualized growth
dropped (0.03 percent) for the first time since August 2022.
Regional Jobs Index
- The South led regions for the twelfth consecutive month and is
the only region with an index above 100 (100.68). Still, the South
reported its first decrease (-0.14 percent) since September 2022.
- At 99.96, the Midwest ranked second among regions—as it has for
the past two quarters—and its Index has increased for four
consecutive months.
- March brought hints of a narrowing growth gap between regions,
as the bottom-ranked West lead the country in gains (0.19 percent)
and the top-ranked South lead in losses
(-0.14 percent).
Regional Wage Report
- The South led hourly earnings growth among regions (4.86
percent) for the eighth consecutive month.
- The Midwest ranked last among regions in hourly earnings growth
(4.45 percent) and first in weekly hours-worked growth (0.52
percent).
- Hourly earnings growth in the West grew to 4.77 percent in
March, as one-month annualized growth jumped to 6.24 percent—its
highest level since 2019.
State Jobs Index
- North Carolina's growth rate
slowed 0.42 percent in March to 102.13. However, the state
continued its nine-month streak as the country's leader.
- Illinois' growth rate rose 0.25 percent last month and
1.70 percent YOY. At 101.92 and second among states, Illinois' performance in March is the
strongest it's been since 2014.
- At 98.54, California
ranked last among states but showed its largest one-month gain
(0.22 percent) in more than a year.
Note: Analysis is provided for the 20 largest states based on
U.S. population.
State Wage Report
- Florida ranked first among
states for the ninth consecutive month despite its hourly earnings
growth rate slowing to 5.56 percent in March.
- At 3.18 percent, Virginia
remained last among states for hourly earnings growth, a trend that
has persisted since June 2022.
- Missouri led overall growth
among states for weekly earnings (6.04 percent) and weekly hours
worked (0.93 percent).
Note: Analysis is provided for the 20 largest states based on
U.S. population.
Metropolitan Jobs Index
- Small business employment growth remained strong in
Houston (103.10), making the city
the first among metros for the fifth consecutive month.
- Falling below 100 for the first time this year, the
Dallas metro's Job Index
dropped
5 percent YOY, falling from 105.12 to 99.86 between March 2022 and March
2023.
- San Diego remains last among
metros with its index dropping 4.02 percent YOY. At 97.66, it was
the only state with an index below 98.
Note: Analysis is provided for the 20 largest metro areas
based on U.S. population.
Metropolitan Wage Report
- Miami led metros in hourly
(5.80 percent) and weekly (6.15 percent) earnings growth.
- San Francisco had the highest
hourly earnings among metros ($39.28)
but the lowest growth rate (3.55 percent).
- Philadelphia and nearby
Baltimore lead metros in weekly
hours-worked growth, 0.46 and 0.45 percent, respectively.
Note: Analysis is provided for the 20 largest metro areas
based on U.S. population.
Industry Jobs Index
- Following four months of gains, leisure and hospitality's Job
Index dropped to 101.32 in March, though it remained the top sector
for small business employment growth.
- Manufacturing slowed 97.71 (a 0.16 percent drop) in March,
maintaining its status as the weakest sector for the eighth
consecutive month.
Note: Analysis is provided for seven major industry sectors.
Definitions of each industry sector can be found here. The other
services (except public administration) industry category includes
religious, civic, and social organizations, as well as personal
services, including automotive and household repair, salons,
drycleaners, and other businesses.
Industry Wage Report
- Leisure and hospitality lead sectors in hourly earnings growth
(5.96 percent) for the fifth straight month, despite falling below
six percent for the first time since April
2021.
- Ranked second among sectors, construction reached a new record
for hourly earnings growth, reaching 5.28 percent for the first
time since reporting began in 2011.
- Hourly earnings growth for education and health services
continued to rank last among sectors as it has for the past 18
months. The average growth rate during that period (3.77 percent)
is in line with the current growth rate (3.78 percent).
Note: Analysis is provided for seven major industry sectors.
Definitions of each industry sector can be found here. The other
services (except public administration) industry category includes
religious, civic, and social organizations, as well as personal
services, including automotive and household repair, salons,
drycleaners, and other businesses.
The Small Business Jobs Index methodology was updated with the
March 2023 index published on
April 4, 2023 to utilize the most
up-to-date industry coding possible. The historical update is
reflected in the March 2023 report
and only affects the sectors reported within the "industry"
dimension. For a full description of the report's updated
methodology, read "Understanding the Jobs Index" on the Paychex
website.
For more information about the Paychex | IHS Markit Small
Business Employment Watch, visit www.paychex.com/watch and sign up
to receive monthly Employment Watch alerts.
*Information regarding the professions included in the
industry data can be found at the Bureau of Labor Statistics
website.
About the Paychex | IHS Markit Small Business Employment
Watch
The Paychex | IHS Markit Small Business Employment
Watch is released each month by Paychex, Inc., a leading
provider of integrated human capital management software solutions
for human resources, payroll, benefits, and insurance services, and
S&P Global Market Intelligence, a Division of S&P Global
(NYSE: SPGI), which merged with IHS Markit in 2022 and is a
provider of information services and solutions to global markets.
Focused exclusively on small businesses with fewer than
50 employees, the monthly report offers an analysis of
national employment and wage trends, as well as examines regional,
state, metro, and industry sector activity. Drawing from the
payroll data of approximately 350,000 Paychex clients, this
powerful tool delivers real-time insights into the small business
trends driving the U.S. economy.
About Paychex
Paychex, Inc. (Nasdaq: PAYX) is a leading provider of integrated
human capital management solutions for human resources, payroll,
benefits, and insurance services. By combining innovative
software-as-a-service technology and mobility platform with
dedicated, personal service, Paychex empowers business owners to
focus on the growth and management of their business. Backed by 50
years of industry expertise, Paychex serves more than 730,000
payroll clients as of May 31, 2022 in
the U.S. and Europe, and pays one
out of every 12 American private sector employees. Learn more about
Paychex by visiting www.paychex.com and stay connected on
Twitter and LinkedIn.
About S&P Global Market Intelligence
At S&P
Global Market Intelligence, we understand the importance of
accurate, deep and insightful information. Our team of experts
delivers unrivaled insights and leading data and technology
solutions, partnering with customers to expand their perspective,
operate with confidence, and make decisions with conviction.
S&P Global Market Intelligence is a division of S&P
Global (NYSE: SPGI). S&P Global is the world's foremost
provider of credit ratings, benchmarks, analytics and workflow
solutions in the global capital, commodity and automotive markets.
With every one of our offerings, we help many of the world's
leading organizations navigate the economic landscape so they can
plan for tomorrow, today. For more information,
visit www.spglobal.com/marketintelligence.
Media Contacts
Chris
Muller
Paychex, Inc.
+1 585-338-4346
cmuller@paychex.com
@Paychex
Kate Smith
IHS Markit
+1 781-301-9311
katherine.smith@ihsmarkit.com
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SOURCE Paychex, Inc.