Intuit found that small businesses with fewer than 20 employees added 15,000 jobs in February, a 0.07 percent increase over January. However, small business revenue dipped slightly in January.
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The data from the Intuit Small Business Employment Index is based on approximately 175,000 small businesses customers of Intuit Online Payroll and QuickBooks Online Payroll.
Small business revenues are gradually recovering from recessionary depths, but are just now reaching levels seen before the recession began in 2007, according to the Intuit Small Business Revenue Index, which is based on anonymized aggregated data from QuickBooks Online.
The February revenue index indicated that small businesses overall saw revenue decline in January of 0.6 percent. Among the industries tracked by the Index, none saw an increase in January. The retail industry saw the biggest decline in January at 1.3 percent, followed by “professional, scientific and technical services with a 0.9 percent decline. The average monthly pay for small business employees increased to $2,745 in February, or 0.4 percent; while monthly hours worked increased 0.17 percent in February, corresponding to 109.4 hours.
“Small business employment has risen by 75,000 jobs from this same time last year,” said Susan Woodward, the economist who worked with Intuit to create the indexes. “However, if small business employment were growing at its usual proportionate rate of 15 percent of national employment, that number would be 300,000—a 400 percent difference. The housing bust that was at the center of the economic collapse hurt small business much more than it did big business. In non-recession times, construction industry jobs make up about five percent of all employment, but it comprises nearly 20 percent of jobs in the small business and self-employed segment. Single-family home construction, which was at 2 million houses per year in 2006, is now below 900,000 per year. Until construction truly recovers, we will not see robust recovery in small business employment.”
Small business hourly employees worked an average of 109.4 hours in February, up slightly from the revised figure of 109.2 hours in January, making for a 25.3-hour workweek. The average monthly pay for small business employees increased to $2,745 in January, up 0.4 percent from the January revised figure of $2,733 per month. The equivalent annual wages would be about $32,900 per year, which is part-time work for almost half of small business employees.
Among the 34 states tracked by Intuit’s Small Business Employment Index, employment increased in 13, remained flat in three and declined in 18. Continuing a trend seen in January’s findings, Utah and Nevada saw the largest increases. Alabama, Indiana and Kentucky showed the greatest declines.
The January Small Business Revenue Index showed a 0.6 percent overall revenue decline on a per business basis. “Small business revenues recovered through early 2012, but have since begun to decline, with the health care and the accommodation and food services industries being the first to go,” said Woodward. “The sectors with the smallest declines—almost a recovery by comparison—are construction and real estate services, down less than 1 percent each. This is encouraging for small business employment, for which construction plays a central role.”
The small business retail industry saw the greatest revenue decline, at 1.3 percent in January and has seen a 5.3 percent decline since its peak in February 2012. Health care revenues declined 0.5 percent in January, and 3.7 percent since its peak in March 2012. The accommodation and food services sector was down 0.3 percent in January, a 2.2 percent decrease since its peak in March 2012. This index is based on data from QuickBooks Online.