ROCHESTER, NY—The latest Paychex | IHS Markit Small Business Employment Watch reflects a continuation of the tight labor market to start 2020. Weekly earnings growth improved for the 13th consecutive month, reaching 3.59% in January. Weekly hours worked were up 0.83% from last year, contributing to the growth in weekly earnings. The pace of small business employment growth remains consistent, with the national jobs index increasing slightly (0.01%) in January to 98.18.
“The national index has been flat since mid-year 2019, signaling a continued tight labor market for small businesses,” said James Diffley, chief regional economist, IHS Markit.
“With election season heating up and the economy top of mind for business owners, this month’s Small Business Employment Watch demonstrates the continuing stability of jobs growth recently, as well as weekly earnings improvement,” said Martin Mucci, president/CEO, Paychex. “The data shows consistent employment growth and yet another month of encouraging wage growth, two key indicators that the economy is off to a solid start in 2020.”
Broken down further, the January report showed:
- The South continues to top regions for small business employment growth; the West remains the leading region for hourly earnings growth.
- Tennessee ranks first among states in small business job growth; New York leads in hourly earnings growth.
- Phoenix became the top metro for small business job growth; San Francisco leads metros in hourly earnings growth.
At 5.12%, leisure and hospitality leads hourly earnings growth among industry sectors.
January Paychex | IHS Markit Small Business Employment Watch