The growth rate for small business employment continued rising in September, but at a slower rate than in August.

At the same time, hours worked and compensation remained essentially flat compared to last month. Those were among the findings included in the latest Intuit Inc. Small Business Employment Index. The monthly report found that small business employment grew by 0.14 percent in September, equating to a 1.6 percent annual growth rate. The revised growth rate for August shows that jobs increased more than previously reported, a 0.19 percent increase instead of 0.13 percent, or 2.4 percent on an annual basis. The index is based on figures from the country's smallest businesses that use Intuit Online Payroll.

“September’s employment numbers are good news — the fact that employment is still up, albeit modestly, and not down, is comforting," said Susan Woodward, the economist who worked with Intuit to create the index. “This optimism is also based on the fact that August’s revised employment numbers were better than the original numbers. This continued growth in small business employment should make us less fearful of another decline in economic activity.”

The September employment growth translates to approximately 27,000 new jobs nationwide compared to a revised estimate of 39,000 jobs added in August. Since the growth trend first began in October 2009, small business jobs have increased by a revised estimate of 430,000.

Total compensation per employee and hours worked have grown slowly and steadily since the small business recovery began about a year ago, but remained virtually unchanged from August to September.

Monthly pay for all small business employees was $2,602 per month in September, a marginal 0.15 percent decline from the revised August figure of $2,606 per month. This translates to wages of about $31,200 per year for all employees.

Small business employees worked an average of 105.3 hours for the month in September, translating to a 24.3-hour work week. That was up by a marginal 0.03 percent from hours worked in August.

“The changes in compensation and hours worked for September aren't economically or statistically significant,” Woodward said. “Compensation rose modestly but steadily from September of last year, so a month of no change is not a great concern. From September 2009 to September 2010, hours rose strongly — by nearly 2 hours per week — so it is not surprising for hours to flatten at this point. In terms of hours worked, we are now back to where we were in January 2008. This is good news."

The Intuit Index also breaks down employment by census divisions and states across the country, with the greatest regional growth in the East South Central area. States in the Midwest and Upper Midwest regions showed declines. Individually, New York showed the greatest growth at 0.8 percent.

“It’s good to see continued growth in small businesses employment overall,” said Cameron Schmidt, vice president of Intuit's Employee Management Solutions division. “We can see this reflected in most parts of the country as well. In states where we have 1,000 small firms represented, we saw the greatest increases in New York, North Carolina and Virginia. New Jersey and Illinois showed decreases in employment.”

U.S. Census Division

Percent Change in Employment

East North Central


West North Central


Middle Atlantic




New England




South Atlantic


East South Central


West South Central


Small business employment by U.S. Census Division is up in many parts of the country except for the upper Midwest regions. The data reflects employment from approximately 58,000 small business employers who use Intuit Online Payroll. The month-to-month changes are seasonally-adjusted and informative about the overall economy.


Percent Change in Employment


0 %


0.1 %


0.2 %


0.3 %


-0.2 %


0.1 %


0.3 %

New Jersey

-0.3 %

New York

0.8 %

North Carolina

0.5 %


0 %


0.5 %


0.1 %

Small business employment by state is up for many states across the country with New York, North Carolina and Virginia seeing the greatest increases. New Jersey and Illinois are the only states that saw a slight decrease 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.

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