According to the Paychex Small Business Employment Watch, hourly earnings growth increased slightly to 3.34%, ending a nearly two-year trend of deceleration, and job growth slowed in April. U.S. small businesses with fewer than 50 employees continued to add jobs but at a slower pace with the Small Business Jobs Index standing at 100.12.
The growth in weekly hours worked for employees also slowed for the 13th consecutive month, down -0.41% in April.
“Our jobs index remains over 100, indicating continued year-over-year employment growth, yet the pace of growth has slowed,” said John Gibson, Paychex president and CEO. “Demand for qualified workers continues to outweigh supply, which may be forcing employers to consider offering higher wages to attract and retain talent.”
“Hourly earnings growth increased to 3.34% in April, ending a decline that began in mid-2022.” Gibson added. “We continue to see employers controlling hours worked as weekly earnings growth is below three percent again in April, indicating that while some workers are seeing increases in their hourly rate, they may not be taking more home.”
Jobs Index and Wage Data Highlights
- At 100.12, the national jobs index continues to represent positive job gains but is down 1.06 percentage points from last year (101.18).
- Hourly earnings growth increased to 3.34% in April, marking the end of a steady deceleration that began mid-2022. However, as weekly hours worked growth (-0.41%) remains negative year-over-year, weekly earnings growth is below three percent again in April (2.88%).
- The West (3.75%) leads regional hourly earnings growth for the 11th consecutive month. Washington (4.91%) and Seattle (5.11%) tops states and metros, respectively, for hourly earnings growth among U.S. small business workers.
- The rate of small business job growth decelerated across all industries in April, though Education and Health Services (101.60) remains one of the strongest sectors for job growth.
- For the sixth consecutive month, Construction led growth among sectors in hourly earnings (3.85%), weekly earnings (3.80%), and weekly hours worked (0.28%).
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Tags: Payroll
