Paychex Small Business Jobs Index Jumps in July

On the heels of news that the United States economy grew 6.5% last quarter, the latest Paychex | IHS Markit Small Business Employment Watch report found a sharp increase in small business job growth as well as a significant bump in hourly wages these businesses pay. In July, the Small Business Jobs Index increased by 0.85 points to reach 99.36. This actually marked the second largest single-month jump since 2010. With the latest boost, the index is now up one percentage point from last quarter and up five pecent when compared to this point last year.

Looking at specific areas where small business job growth is occurring, Tampa, Florida and Dallas, Texas each saw index figures above 102 in July. Meanwhile, Atlanta, Georgia also saw a significant increase, climbing 2.28 percent to reach 101.08. In terms of states, Arizona led the way with an index of 101.72 in July. On the other hand, Denver, Colorado was the only metropolis to a decrease in small business jobs, dropping 0.47 percent and hitting 98.70.

With the job market proving competitive for employers, July also brought an increase in wages. During the month, average hourly earnings were $29.42. That marks a growth of 3.11% — which bests the 2.84% growth that came in June. However, due to continued slowing in the number of weekly hours worked, weekly earnings growth was a bit softer, increasing 2.45% in July.

As for the states where wage growth was strongest, Missouri came in first place yet again, making for a three-month streak. Hourly earnings in the Show Me State grew by 4% during the month. Yet, in terms of weekly earnings growth, California won out with a 3.95% increase. Looking at wages regionally, the West had the highest average wage hourly wage at $31.14 followed by the Northeast at $30.58. Wages in the Midwest and South were neck and neck, coming in at $27.65 and $27.69 respectively.

Commenting on July’s results, IHR Markit chief regional economist James Diffley summed them up, saying, “Hiring at small businesses across the U.S. grew significantly in July. The national index jumped to 99.36, the highest level since the summer of 2018.” Elsewhere, Paychex president and CEO Martin Mucci remarked, “The rate of hiring continues to increase steadily across all sector. July’s small business job and wage growth numbers indicate a continued rebound of the economy as employment increases.”

While these latest figures are full of good news, that optimism may be tempered by the current state of the pandemic. With the spread of the Delta variant increasing in many parts of the country, there’s a chance that economic recovery could see a setback. That said, with vaccinations continuing to roll out (albeit at a slower clip than they were earlier this year), local lockdown measures taken last year seem unlikely at this point. Nevertheless, future editions of the Paychex | IHS Markit Small Business Employment Watch may prove to be a bit more complicated as America and its small businesses continue to navigate the ever evolving landscape.


Jonathan Dyer

I'm a small town guy living in Los Angeles looking to make solid financial decisions. I write for a number of finance websites, including HuffingtonPost and Business2Community. I founded in 2015 to focus on personal finance and the emerging FinTech markets.

Other Articles by Jonathan Dyer

Uber Relaunches UberPool as UberX Share

With demand for travel continuing to rise, the ridesharing app Uber has announced a feature to help both travelers and commuters to get to their destinations while saving money. After previously pausing its UberPool service option during the pandemic, Uber is now rolling out a replacement called UberX Share. At this time, the new option is available to riders in New York City, Los Angeles, Chicago, San Francisco, Phoenix, San...

Split Payment Platform Kasheesh Launches as Alternative to BNPL

In recent months, "buy now, pay later" (BNPL) platforms have exploded in popularity. What's more, with Apple jumping into the space, the practice is likely to continue growing despite some concerns in regards to how BNPL services impact consumers' personal finances. With that in mind, one FinTech has just revealed its alternative: a payment-splitting platform for online retail. Today, Kasheesh exited stealth mode to announce the launch of its unique...

Credit Karma Money Spend Adds Cashback Offers for Cardholders

Those looking to add some extra cash back into their pocket will soon have a new option. This week, the popular credit monitoring site Credit Karma announced a new feature for its Credit Karma Money customers. Now, debit cardholders will be able to earn cashback when making purchases from select retailers. According to the site, the list of eligible retailers includes national chains, such as Adidas and Shake Shack, as...