The Small Business Employment Index (SBEI) from top 15 accounting firm CBIZ reported a seasonally adjusted decrease of 0.58% in October, marking the second straight month of hiring declines and the fourth negative month out of the past six.
The CBIZ SBEI tracks payroll and hiring data for more than 2,800 companies with 300 or fewer employees across the U.S. The index indicated a seasonally adjusted decrease of 2.60% in September.
Eighteen percent of companies in the index increased staffing, while 61% made no change to their headcounts and 21% reduced employment totals.
“The weakness we’re seeing in October isn’t just an isolated occurrence; it’s part of a broader trend,” Anna Rathbun, chief investment officer of CBIZ Investment Advisory Services, said in a statement. “Recent SBEI data aligns with a softening labor market reflected in the past six months of jobs data, highlighting a sustained slowdown.”
The Bureau of Labor Statistics’ employment report indicated hiring growth that missed expectations. The October reading showed an overall increase of 12,000 private-sector jobs. The national unemployment rate held steady at 4.1%. The report is inclusive of all non-farm private employers across businesses of all sizes.
The ADP employment report indicated hiring growth among small, medium, and large-sized companies. Its October reading showed an overall increase of 233,000 private-sector jobs for the month. Small businesses accounted for an increase of 4,000 jobs on a seasonally adjusted, month-over-month basis. The ADP report counts small businesses as companies with 49 or fewer employees, while the CBIZ SBEI uses data from companies with 300 employees or fewer.
The West (1.69%) was the only region to report an increase in hiring. The Central region (-0.95%) saw the largest decline, followed by the Southeast (-0.57%) and Northeast (-0.22%) regions.
On an industry level, insurance, technology and life sciences, and transportation saw an uptick in hiring, while construction, real estate, and rental and leasing services reported the largest job losses.
“October’s data reinforces the challenges small businesses are facing as they navigate a labor market that has yet to find stable ground,” Rathbun said. “With signs of slowing momentum and a shifting economic environment, small business owners are approaching hiring with heightened caution.”
What’s next? CBIZ said, “As we move toward year-end, small businesses will continue to watch labor data closely to navigate these evolving trends. The coming months will be telling of small business resilience in the face of ongoing economic uncertainties.”
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Tags: Accounting, Human Resources, Payroll, Small Business
