More Evidence of Small Business Hiring on the Decline
While last week’s U.S. Department of Labor report on private sector payrolls for the month of October was much stronger than expected, there is some concern that small businesses are no longer hiring or have sharply curtailed their hiring. That was the take from the National Federation of Independent Business (NFIB) via its Small Business Optimism Index for October, which was released on Tuesday. Now we have more supporting data via an Intuit measurement.
Intuit has suggested that the strong national numbers aren’t the reality for all businesses, especially in small businesses. Intuit’s monthly Small Business Employment and Revenue Indexes show that employment in firms with fewer than 20 employees remained almost unchanged for the third consecutive month.
The Small Business Employment Index was more or less flat (+0.01%) at 97.56 in October, with monthly employee compensation up 0.6% at $2,904, on a 0.6% gain in monthly hours at 113.1 hours.
How surveys are conducted can play a key role in how the numbers pan out from month to month. The Intuit Small Business Employment Index measures current employment levels for companies with fewer than 20 employees. This report is released monthly and includes geographic detail on small business employment, compensation per employee and hours worked. The data are derived from approximately 265,000 small business employers, a subset of 1.2 million businesses using Intuit Payroll.
Intuit reminds readers of the importance of small businesses in the economy. After all, the smallest employers are said to make up about 87% of the total U.S. private employer base and employ 20.7 million people.