By Rieva Lesonsky
The small business hiring trend that started in October 2009 continued this past month. The most recent Intuit Small Business Employment Index found that small business employment grew by 0.3 percent in September, adding up to an annual growth rate of 3.3 percent. Hours worked and compensation increased as well.
Based on these numbers and revised national employment data from the Bureau of Labor Statistics, Intuit revised its previously reported growth rate for August from 0.18 percent to 0.3 percent, or 65,000 jobs added in August. Since October 2009, Intuit reports that small businesses have added 720,000 new jobs.
“After all the uproar over the threatened European financial meltdown, [this] good news is very welcome,” said Susan Woodward, the economist who worked with Intuit to create the index. “We have some distance to go to make up for growth that didn’t happen during the recession, but this is a good start.” Woodward believes the strong numbers could be due to increases in residential property prices for the past five months in a row. “There are all kinds of small businesses linked to property, such as construction contractors, real estate agents and brokers,” she notes.
The number of hours that hourly small business employees worked increased as well, to an average of 110.4 hours (or a 25.5 hour workweek) in September. This was a 0.3 percent increase from the revised August figure of 110.0 hours.
“In this recession, these smallest businesses have tended to cut back on employee hours rather than lay people off, so it’s good to see hourly people working more,” added Woodward.
In addition to hours, average monthly pay rose as well. Average monthly pay for all small business employees was $2,694 per month in September, Intuit found–a 0.3 percent increase compared to the August revised estimate of $2,685 per month. The equivalent annual wages are about $32,300 per year.
“Compensation is up by a healthy amount and equivalent to an annual growth rate of more than 3 percent,” said Woodward. “This is very good considering that over the last 30 years real income has grown at a rate of about 1.5 percent per year. We have some distance to go to make up for growth that didn’t happen during the recession, but this is a good start.”
The Intuit Small Business Employment Index is based on online employment data from some 70,000 small business employers with fewer than 20 employees.
Image by Flickr user Dave Bleasedale (Creative Commons)Google+