Small Business Employment Up But Sluggish In September
Written by Ken Gaebler
Intuit report shows that small business employment continues a trend of slow growth in September as more workers go into business for themselves.
U.S. small business employment continues to grow at a sluggish pace as compensation and hours worked increased, according to Intuit's Small Business Employment and Revenue Indexes for September.
This latest Intuit index showed that small business employment rose by approximately 0.2% in September for annualized growth of 2.5%. In terms of actual jobs, small businesses added about 40,000 new positions during the same time period.
The September employment report also showed that average monthly compensation increased by 0.6% (or $17) -- a marked increase from the average growth of $2 that was reported in August. The number of average monthly hours worked increased by 12 minutes or 0.18%.
"This month's indexes bring both good and bad news," said Susan Woodward, the economist who worked with Intuit to create the indexes. "The bad news is that while revenue rose earlier in this tepid recovery, they are now dropping for most industries. In addition, small business employment is growing very slowly, and is essentially flat. Couple that with the slow employment growth of less than one-tenth of a percent for big businesses, and we see a slim chance of full employment anytime soon."
One of the few bright spots in the report was that self-employment appears to be gaining steam as more Americans choose to launch small businesses. Although there is a big difference between starting a business and starting a successful business, slow employment growth in the small business sector may provide the catalyst would-be entrepreneurs need to take the leap to business ownership.
"The good news is that more people are going into business for themselves," said Woodward. "After five years of declining self-employment beginning in January 2007, we began seeing a big comeback starting in November 2011. Nearly 600,000 additional self-employed folks have been added since then, and there are now 14.2 million people who are self-employed." Woodward adds that declining revenue per business figures may be due to the sudden influx of new entrepreneurs and new businesses into the economy.
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