Small businesses employment increased by 0.3 percent in March, the highest single-month growth rate in more than two years. This growth was accompanied by encouraging increases in monthly compensation and in the number of hours worked.
These are among the results for the
Small Business Employment Index
for March, covering the period between Feb. 24 and March 23. Based on the March increase, the latest report estimates that small business employment grew at an annual growth rate of 3.8 percent. Average monthly hours worked increased by 0.5 percent, or 36 minutes. Average monthly compensation increased by 0.7 percent, or $18 per worker.
The employment growth for March equates to approximately 65,000 new jobs in March, though Intuit plans to recalibrate its Employment Index in the coming months and expects these numbers to be lower. This is a common statistical practice and the recalibration will be based on new data provided by the Bureau of Labor Statistics, which are used as inputs into the Index.
The Index is based on figures from small businesses with fewer than 20 employees that use Intuit
. More information on the Index is available at
“This is the strongest small business employment report we have had in a long time,” said
, the economist who worked with Intuit to create the Index. “Yet at the same time, the hiring rate has remained flat at just above five percent since May 2009. This indicates that small firm employees are staying with their current employers, rather than leaving for bigger firms. In normal times, the turnover at small firms, which typically pay less than their larger counterparts, is high. Currently, the turnover rate is still low compared to normal.
“However, we are not out of the woods yet. While the various indicators of this market are the strongest we’ve seen in a while, the rate of increase will not get us back to full employment anytime soon.”