Small Business Jobs Growth Holds Steady in May
Wednesday, May 31st, 2023
The rate of small business job growth was unchanged from April for the month of May, according to the latest Paychex | IHS Markit Small Business Employment Watch. The national Small Business Jobs Index — which measures the rate of small business job growth in the U.S. — stands at 99.45, a 0.04% decrease from April. Meanwhile, hourly earnings growth for U.S. workers slowed to 4.33%.
"Hourly earnings gains continue to decelerate while the small business job market has been stable in 2023," said James Diffley, chief regional economist, S&P Global Market Intelligence.
"Despite the challenges of a competitive labor market and tightening credit, our data suggests small businesses remain resilient as job growth holds steady," said John Gibson, Paychex president and CEO. "Our data also shows a consistent trend of hourly earnings growth slowing over 11 of the past 12 months, perhaps providing some relief for businesses looking to hire."
In further detail, the May report showed:
At 99.45, small business employment growth is 1.41% lower compared to a year ago (100.87).
Wage growth continues to fall nationally, with hourly (4.33%) and weekly earnings growth (3.96%) both dropping in May.
The South leads small business employment growth among regions for the 14th consecutive month at 100.47.
North Carolina leads job growth among states for the 11th consecutive month at 101.48.
Texas ranks first among states for both hourly (5.46%) and weekly earnings growth (4.99%).
Houston is once again the top metro for small business job growth for the seventh straight month. Houston also ranks first among metros for hourly earnings growth (5.34 percent) in May.
Construction is the top sector for all three wage data components: hourly earnings growth (4.89%), weekly earnings growth (5.00%), and weekly hours worked growth (0.35%).
Paychex solutions reach 1 in 12 American private-sector employees, making the Small Business Employment Watch an industry benchmark. Drawing from the payroll data of approximately 350,000 Paychex clients with fewer than 50 employees, the monthly report offers analysis of national employment and wage trends, as well as examines regional, state, metro, and industry sector activity.
The complete results for May 2023, including interactive charts detailing all data, are available at www.paychex.com/watch. Highlights are available below.