This morning Intuit released the latest installment of the Intuit Small Business Indexes, which reveal tepid results. While employment is still growing, the growth rate is slowing down.
Small business employment increased by 0.16 percent in August — down from a revised growth rate of 0.2 percent in July — while revenues continued to decline for the fifth consecutive month.
This edition of the indexes reports on August employment, compensation, and hours worked, along with the July revenue figures among U.S. small businesses.
Here are some highlights:
- 30,000 new jobs were created in August.
- The highest employment growth was again seen in Michigan, at a rate of 0.5 percent growth from the prior month. (See below for the full state breakdown.)
- Average monthly compensation in August increased by 0.08 percent, or $2, compared with the $7 increase seen in July.
- Average monthly hours worked in August was 106.4 hours, down 0.6 percent, or 42 minutes, from the revised figure of 107.1 hours in July.
“Small businesses are hurting,” says Susan Woodward, the economist who worked with Intuit to create the indexes. “The employment rate has been slowing since April, and revenues have been falling since March, declining 2.7 percent from its most recent peak. At an annual rate, this is a decline of just over 6 percent, which is substantial.”
The employment index is based on data from approximately 83,000 small businesses using Intuit Online Payroll.
Change in Employment
- Small businesses overall saw revenue decline by 0.6 percent in July.
- The accommodation and food services sector, along with the retail industry, saw the largest decline at 1.1 percent from the previous month. (See below for the full industry breakdown.)
- The health care and social assistance sector continued to see the smallest decline, at 0.4 percent, though the rate of decline was 10 times more than the 0.04 percent decline seen in the previous month.
“Among the industry sectors tracked by Intuit, the hardest hit recently has been small business retail, whose revenue has declined 6.1 percent from January to July,” says Woodward. “The sector with the smallest decline is health care, which fell 1.3 percent from December 2011.”
Change in Revenue
|Accommodation, food services and drinking places|
|Real estate and rental and leasing|
|Professional, scientific and technical services|
|Health care and social assistance|
The revenue index is based on data from approximately 100,000 small businesses using QuickBooks Online.
Want more information about the indexes and methodology? Check out index.intuit.com to see detailed breakdowns of growth (by industry and geography) and to download the full report.