SMBs

SMB wages growing while jobs decline in almost every industry

Manufacturing was the only industry to see job growth at the end of 2017, according to a Paychex report.

Building a slide deck, pitch, or presentation? Here are the big takeaways:
  • The Small Business Jobs Index dropped 0.16% in December, ending the year 0.78% under its highest point in February. —Paychex, 2018
  • Wages grew 2.85% on average in 2017 for SMBs. —Paychex, 2018

While 2017 ended with a month of US SMB job growth decline, wages were up 2.76% year over year (YOY), according to Paychex IHS Markit Small Business Employment Watch.

SMB job growth peaked for the year in February at 100.78, falling nearly a full percentage point by December, ending at 99.7. The findings could mean that after years of development, small business growth may be slowing as 2018 begins.

Average hourly earnings, however, increased 2.85% over 2017, and grew 2.76%—about $0.70—since December 2016, Paychex said. Combined with slowed job growth, this may suggest that businesses are focusing more on the employees they have instead of hiring more people.

SEE: Vendor contract renewal planner (Tech Pro Research)

"While small business jobs growth slowed this year, it's important to recall that small businesses led the hiring surge coming out of the recession and maintained high levels of growth for quite some time," Martin Mucci, Paychex president and CEO, said in the press release.

Job growth dropped more in December 2017 than in the past four months combined, the report said. But while SMB growth slowed, the rest of the economy grew, IHS Markit chief regional economist James Diffley noted in the release.

Out of the seven industries the report looked at, all remained stable or saw slow growth. Manufacturing was the only one that grew, climbing 1.61%.

The South led in regional employment growth, but the report noted all regions declined in December. For wages, the West led, followed by the South. Top states for job growth included Tennessee, Washington, and Florida, despite all decreasing about 1% since 2016. Seattle, WA was named the top metro area for SMB job growth.

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About Olivia Krauth

Olivia Krauth is a Multiplatform Reporter at TechRepublic.

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