This morning we released the latest installment of the Intuit Small Business Indexes, which reveal mixed results. Employment saw a tepid growth of 0.17 percent growth last month, while revenue was down across all industries tracked by the revenue index.
This edition of the indexes reports on July employment, compensation, and hours worked, along with the June revenue figures among U.S. small businesses.
Here are some highlights:
- 35,000 new jobs were created in July.
- The highest employment growth was seen in Michigan, at 0.7 percent growth from the prior month.
- Average monthly compensation in July increased by 0.3 percent, or $7, compared with a 0.5 percent, or $14, increase in June.
- Average monthly hours worked in July was 106.3 hours, down 0.3 percent, or 18 minutes, from the revised figure of 106.7 hours in June.
“Other signals about small business employment are mixed as well,” says Susan Woodward, the economist who worked with Intuit to create the indexes. “The trend in hours worked has been declining slightly since October of 2011, as has the fraction of hourly workers working full-time. However, compensation per employee rose this month, continuing a trend for more than a year, and the hourly rate is up also, at an annualized rate of 4 percent. Though employment is slowly growing, the small business hiring rate is essentially unchanged and remains far lower than it was in 2007.”
The employment index is based on data from approximately 82,000 small businesses using Intuit Online Payroll.
- Small businesses overall saw revenue decline by 0.5 percent in June.
- The accommodation and food services sector saw the greatest decline at 0.7 percent, followed by the retail sector at 0.5 percent.
- The construction industry and health care and social assistance sectors saw the smallest declines, at 0.01 and 0.04 percent respectively.
“While construction accounts for about 8 percent of employment among all companies, it accounts for roughly 20 percent of employment for small companies, so any change in this sector is important,” says Woodward. “Given the falling revenues for May and June, weak employment growth in July is not a surprise.”
The revenue index is based on data from approximately 150,000 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.