U.S. small business employment grew for the fourth consecutive month in June, adding 20,000 jobs, according to Intuit.
While the labor market continues to show signs of revival, small business employment remains 900,000 workers shy of the peak reached in March of 2007. Those are among the findings of the monthly Small Business Employment and Revenue Indexes.
The June figures revealed that small businesses have added 595,000 jobs since March 2010, the beginning of the recovery in small business employment. Employees' average monthly compensation grew by $1, or 0.03 percent, from May's revised figure. Average monthly hours worked by hourly employees decreased by one minute from May to June, or 0.02 percent.
The employment index is based on data from Intuit Online Payroll and QuickBooks Online Payroll, covering the period from May 24 through June 23.
"This month's employment data makes for the fourth consecutive month of small business job growth after a flat job market early in 2014,” said Susan Woodward, the economist who works with Intuit to create the indexes. “While employment growth continued this month, changes for compensation and hours worked were mixed but very small. This indicates that while the employment picture has improved, there is little pressure on wages or hours. The revenue figures for small businesses are better than they have been in some years—they were up in April, and are up even more in May. The rise in revenues for all businesses is about three-fourths of one percent, which is a lot, and if it continued for a year, would give us an increase of 10 percent."
Hourly small business employees worked an average of 107.2 hours in June, a decline of roughly 0.02 percent, or 1 minute, translating to a 24.7-hour work week.
Average monthly pay for small business employees increased by 0.03 percent, rising $1 to $2,715 in June. The equivalent yearly wages would be approximately $32,600. The average hourly wage rose by a bit less than one cent, to $15.92 per hour. The fraction of hourly people working full-time has been falling since August 2011.
Small businesses across the nation continued to show growth. However the changes were mixed geographically. Among the 40 states that Intuit tracks, Michigan saw the largest decline in small business employment, falling by 0.4 percent. The states with the largest employment gains are Washington and Idaho, both rising 0.4 percent.
Hours worked fell across the Eastern Seaboard affecting all three divisions: New England, Mid-Atlantic, and South Atlantic. The census division that saw the largest decline is the East North Central, which includes the Great Lakes area and Michigan.
Intuit’s May Revenue Index showed overall gains in small business revenue across all industries, marking the first time in more than a year with growth that is both substantial and manifest in all groups. Professional services recorded the biggest increase, followed closely by construction, which is coming back from a serious decline during the worst of the financial crisis.
The health care industry showed the smallest increase. This sector was relatively immune from the recession, with demand for health care services largely insensitive to an economic downturn. This index is based on data from QuickBooks Online, covering the period from May 1 to 31.
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