A New Year: Employment Increases, Revenues Decline, Wages Drop
Kicking off the new year the right way, U.S. small businesses added 20,000 new jobs in January, equating to a 0.11 percent increase from December, according to Intuit’s Small Business Employment and Revenue Indexes. Construction, a strong indicator of the health of U.S. small businesses, was the only industry to see revenues increase in December.
“The small business employment recovery has resumed,” remarked Susan Woodward, the economist who worked with us to create the indexes.
The number of small business jobs currently stands at a little over 19.9 million, which is still well below the pre-recession level of 21.2 million jobs in March 2007, but the silver lining is that the rate of small business employment has continued its climb after the slight drop seen between April and September 2012.
The average monthly wage in January 2013 was $2,676, a decrease of $6 from December, compared to the increase of $13 that was seen from November to December. At a national level, average compensation per employee fell in all U.S. census divisions. Average monthly hours worked decreased by 0.9 percent, or almost one hour, compared to the increase of five minutes seen last month. Small business employees worked an average of 105.1 hours in all of January, equating to a 24.3-hour workweek.
A Regional Glance
Among the 33 states tracked by Intuit’s Small Business Employment Index, 11 showed employment increases, two remained flat, and 20 showed decreases. Utah and Nevada saw the largest increases, while Michigan and Indiana saw the greatest declines.
Small business revenues declined for the tenth consecutive month in December, according to the latest edition of the Intuit Small Business Employment and Revenue Indexes.
Overall, small businesses saw a 0.4 percent revenue decline on a per business basis in December. Construction was the sole industry to see an increase, at 0.3 percent. The real estate and retail industries saw the biggest drop-offs, at 0.8 percent each.
Construction remains the bright spot in the midst of falling revenues in other industries, seeing a rise of 3.1 percent in revenue or the past year, versus a decline of 1.8 percent for small businesses overall.
The sectors with the biggest decline over the past year were retail establishments, with a five percent decline since early 2012, and health care, with a 3.8 percent decline.
|Sector||December 2012 Change in Revenue (%)|
|Real estate and rental and leasing||
|Health care and social assistance||
|Professional, scientific, and technical services||
|Accommodation, food services, and drinking places||
The revenue index is based on data from approximately 100,000 QuickBooks Online customers.
Want more information about the indexes and methodology? Check out index.intuit.com to see detailed breakdowns of growth (by industry and geography) and to download the full report.