Small Business Wage Growth Continues Downward Trend, While Job Growth Remains Stable
31 10월 2023 - 9:30PM
Business Wire
One-month annualized hourly earnings growth
hits lowest level since 2020
According to the Paychex | IHS Markit Small Business Employment
Watch, job growth across the U.S. remains moderate but is growing
at a slower rate than a year ago. Meanwhile, growth in hourly and
weekly earnings decelerated in October, consistent with recent
trends. Hourly earnings growth is below four percent (3.56%) for
the fourth-straight month.
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Small business job growth has slowed
0.66% from a year ago, but remains above pre-pandemic (2019)
levels. Hourly earnings growth is below four percent for the
fourth-straight month. (Graphic: Business Wire)
“Over the past year and a half, we’ve seen a stabilization of
the growth of both small business jobs and wages, in line with
macroeconomic trends,” said John Gibson, Paychex president and CEO.
“Following a long period of wage inflation, we are seeing that
trend begin to cool, as the supply and demand for workers appears
to be coming back into balance.”
“The small business employment and wage trends we’re seeing at a
national level can be largely attributed to changes taking place in
individual industry sectors,” added Frank Fiorille, Paychex vice
president of risk, compliance, and data analytics. “For instance,
in Leisure and Hospitality, hourly earnings growth is declining and
fell below four percent for the first time since 2021.”
In further detail, the October 2023 report shows:
- The rate of small business job growth has slowed 0.66% from a
year ago to 98.77 but remains above pre-pandemic (2019)
levels.
- Hourly earnings growth has decelerated in 16 of the past 17
months, declining from 5.17% in May 2022 to 3.56% in October
2023.
- One-month annualized hourly earnings fell to 2.27%, the lowest
level since November 2020.
- Leisure and Hospitality hourly earnings growth slowed below
four percent (3.93%) for the first time since February 2021.
- The South leads regional small business job growth for the 19th
consecutive month. At 4.10%, the West tops regional hourly earnings
growth for the fifth-straight month.
- At 100.66, North Carolina has led the pace of small business
job growth among states for the 15th of the past 16 months.
Meanwhile, Michigan and Ohio are the two weakest states for job
growth in October.
- Indiana (100.11) ranks second among states for small business
job growth and is the only state with positive one-month,
three-month, and 12-month change rates. The Hoosier State also has
the lowest hourly earnings growth rate at 2.16%.
- Houston has now been the strongest among the top U.S. metros
for small business job growth for a year. In October, its index
stands at 101.83, more than 1.50 points above the second-place
metro (Chicago).
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 October 2023, including interactive
charts detailing all data, are available at www.paychex.com/watch.
Highlights are available below.
October 2023 Paychex | IHS Markit
Small Business Employment Watch
National Jobs Index
- The pace of small business job growth slowed for the seventh
consecutive month, declining 0.12% to 98.77 in October.
- The rate of small business job growth has slowed in 17 of the
last 20 months, falling from the record high of 101.33 in February
2022 to 98.77 in October 2023.
- At 98.77, the national index is down 0.66% from a year ago as
slower but moderate growth remains.
National Wage Report
- Hourly earnings growth slowed to 3.56% in October 2023,
declining 16 of the past 17 months.
- One-month annualized hourly earnings growth fell to 2.27%, the
lowest level since November 2020.
- Weekly earnings growth decreased to 3.27%, slowing
approximately one and a half percent so far in 2023.
- Down 0.39% from last year in October, weekly hours worked
growth has been relatively unchanged during the past several
months.
Regional Jobs Index
- The South decreased 0.25% to 99.26 in October and, despite
slowing each month since February 2023, the South leads regional
small business job growth for the 19th consecutive month.
- The Midwest (98.78) has ranked second among regions for the
past year.
- The Northeast (98.39) remains the weakest region for small
business employment growth but was unchanged in October.
Regional Wage Report
- At 4.10%, the West leads regional hourly earnings growth for
the fifth-straight month and remains the only region above four
percent.
- The Midwest ranks last among regions in the level and growth
rate of weekly earnings ($954.78 and 3.13%).
- Annual weekly hours worked growth is negative for all regions,
though all regions are positive from a three-month annualized
perspective.
State Jobs Index
- At 100.66, North Carolina has led the pace of small business
job growth among states for 15 of the past 16 months.
- In the Midwest states, Michigan (97.86) and Ohio (97.98) are
the two weakest states for job growth in October.
- Ranked second among states as recently as May, the rate of job
growth in Georgia fell 0.95% to 98.42, 15th among states in
October.
State Wage Report
- At 5.18%, Washington ranks first among states for hourly
earnings growth for the fourth consecutive month. Washington is the
only state with hourly earnings growth above five percent, which is
also true for one-month and three-month annualized growth.
- Indiana (2.16%) and Georgia (2.68%) are the only two states
with hourly earnings growth below three percent. Both states
reported growth above five percent in October 2022.
Metropolitan Jobs Index
- Houston (101.83) continues to be the strongest among top U.S.
metros for small business job growth, a distinction it has held for
the past 12 months and is more than a point and a half above the
next-best metros (Chicago: 100.21, Miami: 100.14).
- San Francisco (98.57) has the best three-month and 12-month
change rates among metros at 0.41% and 1.14%, respectively.
- Denver (96.35) remains the weakest among top U.S. metros for
the fourth consecutive month and is the only metro below 97. The
area slowed 0.82% in October and 3.79% from last October.
Metropolitan Wage Report
- Seattle (5.14%) is the only metro with hourly earnings growth
above five percent in October and is the only metro with one-month
and three-month annualized growth above five percent.
- Hourly earnings growth in Atlanta has quickly slowed in 2023,
falling to 2.03% in October, the weakest among top U.S. metros. The
metro averaged 5.45% growth in 2022.
- San Diego was the only top U.S. metro to report weekly earnings
growth above four percent in October (4.02%).
- Miami is the only metro with positive weekly hours worked
growth in October (0.29%).
Industry Jobs Index
- Other Services (100.70) and Education and Health Services
(100.33) are the top two sectors for small business job growth for
the seventh consecutive month.
- At 98.26 in October, the rate of small business job growth in
Leisure and Hospitality slowed 0.59% from last month and 1.74% from
last year, the most significant change rate among industries.
- Financial Activities (97.98) gained 0.09% during the past
quarter and is the only industry to improve its pace of job
growth.
Industry Wage Report
- Construction leads growth among sectors in hourly earnings
(4.18%), weekly earnings (4.19%), and weekly hours worked (0.09%)
in October.
- Trade, Transportation, and Utilities ranks second in growth
among sectors in hourly earnings (3.97%), weekly earnings (4.03%),
and weekly hours worked (0.06%).
- Leisure and Hospitality hourly earnings growth slowed to 3.93%,
marking its first month below four percent since February 2021.
Leisure and Hospitality ranks fourth among sectors in October after
ranking first or second for the past two and a half years.
For more information about the Paychex | IHS Markit Small
Business Employment Watch, visit www.paychex.com/watch and sign up
to receive monthly Employment Watch alerts.
*Information regarding the professions included in the industry
data can be found at the Bureau of Labor Statistics website.
About the Paychex | IHS Markit Small Business Employment
Watch The Paychex | IHS Markit Small Business Employment Watch
is released each month by Paychex, Inc., a leading provider of
payroll, human resource, insurance, and benefits outsourcing
solutions for small-to medium-sized businesses, and S&P Global
Market Intelligence, a Division of S&P Global (NYSE: SPGI),
which merged with IHS Markit in 2022 and is a provider of
information services and solutions to global markets. Focused
exclusively on small business, the monthly report offers analysis
of national employment and wage trends, as well as examines
regional, state, metro, and industry sector activity. Drawing from
the payroll data of approximately 350,000 Paychex clients, this
powerful tool delivers real-time insights into the small business
trends driving the U.S. economy.
About Paychex Paychex, Inc. (Nasdaq: PAYX) is an
industry-leading HCM company delivering a full suite of technology
and advisory services in human resources, employee benefit
solutions, insurance, and payroll. The company serves approximately
740,000 customers in the U.S. and Europe and pays one out of every
12 American private sector employees. The more than 16,000 people
at Paychex are committed to helping businesses succeed and building
thriving communities where they work and live. Visit paychex.com to
learn more.
About S&P Global Market Intelligence At S&P
Global Market Intelligence, we understand the importance of
accurate, deep and insightful information. Our team of experts
delivers unrivaled insights and leading data and technology
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Media Chris Muller Paychex, Inc. 585-338-4346
cmuller@paychex.com @Paychex
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