The results of Intuit Inc.’s monthly Small Business Employment and Revenue Indexes show that small businesses are experiencing only weak employment and compensation growth while seeing a dip in number of hours worked and revenue rates. The Index shows an employment increase of 0.17 percent for July, equating to a current annualized growth of 2.1 percent (about 35,000 new jobs). Average monthly compensation ticked up 0.3 percent ($7) and average monthly hours worked ticked down by 0.3 percent (24 minutes).
Revenue for small businesses fell by half a percentage point from June 2012 while the sector seeing the biggest decline was accommodation and food services, dropping 0.7 percent. The smallest revenue declines experienced in the month of June were in the construction and health care sectors which experienced declines of 0.01 percent and 0.04 percent respectively.
“This month’s indexes indicate a mixed bag for small businesses,” said Susan Woodward, the economist who worked with Intuit to create the indexes. “Revenues have been declining for two months now, so the weak employment growth rate for July is not a surprise. The silver lining is the construction industry, which saw an increase in revenue in May and the smallest decline in June. While construction accounts for about 8 percent of employment among all companies, it accounts for roughly 20 percent of employment for small companies, so any change in this sector is important.”
Small business hourly employees worked an average of 106.3 hours in July; a 24.5-hour work week. Average monthly pay, meanwhile, increased by 0.3 percent over-the-month reaching $2,724 or $32,700 per year.