The Paychex | IHS Markit Small Business Employment Watch, compiled from aggregated payroll data of approximately 350,000 clients on the Paychex human capital management (HCM) suite, is out with the latest numbers. The Small Business Jobs Index increased 4.33 percent from March to 98.34 in April, a positive indicator of job growth rate returning to pre-pandemic levels. The increase is in part driven by the comparison period of one year ago (detailed below). Each region, state, and metro area analyzed in April 2021 saw employment gains. The South leads all regions at 99.42.
“A return to full employment is not complete. However, the Small Business Jobs Index returned to its pre-pandemic peak, seen in February 2020,” said James Diffley, chief regional economist at IHS Markit. “We’re encouraged by the progress in job growth we see in the April numbers.”
“The country has been waiting for a significant increase in job growth since this time last year—and April delivered. Many businesses are finally able to resume regular operations with the onset of vaccine availability for all U.S. adults,” said Martin Mucci, Paychex president and CEO. “The significant growth seen in the leisure and hospitality industry, over the last two months, will only accelerate with the upcoming financial relief available by the Restaurant Revitalization Fund grants made available this week by the SBA.”
In further detail, the April report showed:
• Job growth improved in all four U.S. regions in March, as well as in all 20 states, and all 20 metros analyzed.
• The South continues to lead all regions in small business job growth.
• Texas took the top ranking for job growth among states.
• Leisure and hospitality saw the greatest improvement among industry sectors, but construction still has the highest index at 100.72.
• Leisure and hospitality and construction both also saw a significant gain in hourly earnings growth, 6.78 percent and 4.00 percent, respectively.
Paychex business solutions reach 1 in 12 American private-sector employees, making the Small Business Jobs Index report an industry benchmark. The national jobs index uses a 12-month same-store methodology to gauge small business employment trends on a national, regional, state, metro, and industry basis.
The complete results for April, including interactive charts detailing all data are available at www.paychex.com/watch.
National Jobs Index
The national index spiked 4.33 percent in April to an index level of 98.34. Strong gains from March to April were present. However, the year-over-year increase is driven in part by the low employment levels of the April 2020 comparison period.
The Small Business Jobs Index has improved for four straight months as smaller decreases in early 2021 gave way to significant gains.
At 98.34, small business employment growth is back to pre-pandemic levels.
Regional Wage Report
• The Northeast leads all regions in hourly earnings growth at 3.70 percent, though the region slowed from four percent in March.
• The South ranks first among regions in small business employment growth but last in earnings growth.
• All regions have positive year-over-year weekly hours worked growth.