Despite Rising Job Cuts, Small Biz Hiring Grows
Despite the fact that new data released today (Oct. 5) reveals that publicly announced job cuts in September were 212 percent higher than they were in September of 2010, small businesses are continuing to help fuel the country's employment opportunities, creating 120,000 new jobs in the last two months alone, new research shows.
According to the latest update of Intuit's Small Business Employment Index, small businesses created 55,000 new jobs in September alone, and more than 700,000 since the hiring trend began in October 2009.
This bucks the trends of continued layoffs and firings in the overall workforce, according to data released by outplacement firm Challenger, Gray & Christmas, Inc., which found that layoffs rose 126 percent in the month from August 2011.
Susan Woodward, an economist who worked with Intuit to create the index, said September's small business employment figures — which show the increases in jobs created , hours worked and money earned — is welcome news.
"These solid numbers may be due to the fact that residential property prices have increased for five months in a row," Woodward said in a prepared release. "There are all kinds of small businesses linked to property, such as construction contractors, real estate agents and brokers."
Geographically, the index found that California, Florida and Maryland showed the highest small business employment growth, with an increase of 0.5 percent last month. Oregon and New York were the only states to show slight declines.
The index also revealed that compensation for small business employees increased in September. Average monthly pay for all small business employees was $2,694 per month in September, up 0.3 percent from August.
"We have some distance to go to make up for growth that didn't happen during the recession, but this is a good start," Woodward said.
The number of hours worked at small businesses also rose slightly in September, according to the research.
"In this recession, these smallest businesses have tended to cut back on employee hours rather than lay people off, so it’s good to see hourly people working more," Woodward said.
The Intuit Small Business Employment Index is based on aggregate and anonymous online employment data from approximately 70,000 small business employers, each with fewer than 20 employees.
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