Phoenix ranks first among metros in hourly earnings growth with a 12-month growth rate of 5.14% ($1.26), according to the latest Paychex | IHS Markit Small Business Employment Watch. Arizona also ranks first among states in hourly earnings growth with a 12-month growth rate of 4.74% ($1.14).
On a national level,small business employment growth declined slightly in March, while wage growth remained largely consistent, according to the Paychex | IHS Markit Small Business Employment Watch. Falling 0.12 percent to 99.65 in March, the Small Business Jobs Index has been below 100 for the past nine months and has slowed 1.07 percent since March 2017. Hourly earnings grew $0.69 in the past year to $26.48 for a 12-month wage growth of 2.66 percent, virtually unchanged from 2.67 percent YOY growth in February. Due to continued increases in hours worked, weekly earnings growth is higher than hourly earnings growth at 2.90 percent.
“Small business job growth slowed slightly yet again, to its lowest point in more than seven years,” said James Diffley, chief regional economist at IHS Markit.
“Larger employers are adding more workers than smaller businesses at this time, though the tightening labor market is impacting businesses of all sizes,” said Martin Mucci, Paychex president and CEO. “Interestingly, as job applicants are scarce, this month, we saw one-month annualized hourly earnings increase by nearly three percent among small businesses, compared to the annual growth rate of 2.66 percent. This could be the beginning of accelerating wage growth to attract more employees.”
National Wage Report
• Hourly earnings growth peaked at 2.96 percent in July, but has steadily decelerated to 2.66 percent in March.
• On the strength of increased hours worked, weekly earnings are higher than hourly earnings, up 2.90 percent year-over-year.
• One-month annualized hourly earnings growth improved sizably to 2.94 percent in March, up from just 2.01 percent four months ago, in November.