The tight labor market continues to positively impact wage growth, according to the latest Paychex | IHS Markit Small Business Employment Watch. Hourly earnings grew 3.11 percent among employees of small businesses, the highest level since reporting began in 2011. Weekly earnings continue to grow, accelerating 3.75 percent in November. Essentially unchanged from the previous month, the national jobs index moderated 0.03 percent, remaining above 98.
Arizona and Phoenix rank third among states and metros, respectively, for small business employment growth in November. Arizona’s job index is 99.27 and Phoenix’s is 99.47.
“Wage increases are finally beginning to reflect the tight labor market for small businesses,” said James Diffley, chief regional economist at IHS Markit.
“Employers are responding to the challenges of the tight labor market,” said Martin Mucci, Paychex president and CEO. “We’ve seen a steady climb in hourly earnings growth, now reaching the highest levels in nearly a decade.”
Broken down further, the November report showed:
• The South continues to lead regional small business employment growth; the West retained its lead among regions in wage growth.
• Tennessee remains the leader among states in small business job growth; New York leads states for wage growth.
• Dallas is again the top metro for small business job growth; three California metros, Los Angeles, San Francisco, and San Diego, lead the nation in hourly earnings growth.
• Leisure and Hospitality leads all other sectors in hourly earnings growth.
The complete results for November, including interactive charts detailing all data at a national, regional, state, metro, and industry level, are available at www.paychex.com/employment-watch.