April Report Shows First Signs of Economic Reform Since Fall 2008
According to the latest Intuit Inc. Small Business Employment Index, April saw a 0.33 percent growth in small business employment, equaling a 4 percent total annual growth rate. While 0.33 percent sounds like next to nothing, it equates a 4 percent total annual growth rate and means approximately 66,000 new jobs in April alone, adding up to a total of 300,000 new small business jobs since June 2009. According to the Intuit Small Business Employment Index, June 2009 marked the beginning of an upward trend in small business jobs, a market that had been in decline since 2007.
The monthly Small Business Index is a relatively new effort from Intuit Inc. who in the past has only released annual reports. In order to formulate the monthly Index, Intuit Inc. collects data from roughly 55,000 small businesses (less than 20 employees) that use the Intuit Online Payroll system. While the information collected through this process is not 100% accurately representative of the market, the month-to-month data are recorded and seasonally-adjusted to simulate the economy as a whole.
In addition to increases in small business jobs, the data also shows increases in hours worked and compensation, two other areas that have remained relatively flat since fall 2008. In April alone, both hours worked and compensation were up by 0.5 percent. On average, the employees of the businesses that use the Intuit Online Payroll system worked 105.7 hours and were compensated $2,607 in April as compared to 105.1 hours and $2,595 in March. April’s numbers translate to a 24.4-hour average work week, and $31,300 in annual compensation.
In response to April’s report, Dr. Susan Woodward, the nationally-recognized economist and key founder of the Small Business Employment Index, said “Small businesses are looking healthier. Every trend we measure — employment, hours worked, and monthly compensation — is showing signs of a recovery. Last month the national figures finally began to show a recovery for larger businesses and the entire economy, but for small businesses, the recovery has been underway for more than half a year.”
Vice president of Intuit’s Employee Management Solutions division, Cameron Schmidt, said “It’s heartening to see that not only are small businesses hiring but they are also increasing hours worked and compensation.”
Source: Credit Card Builders
