Small Business Hiring and Wage Growth Remain Consistent in April

ROCHESTER, N.Y., April 30, 2019 /PRNewswire/ -- The Paychex | IHS Markit Small Business Employment Watch for April shows job and wage growth kept pace with recent months. In the first four months of 2019 job growth has remained relatively consistent, slowing just 0.03 percent per month to 98.77 in April. Annualized hourly earnings growth in the last quarter was 2.78 percent, higher than April's rate of 2.50 percent ($0.66).

"While weak, the rate of small business hiring has been consistent, with the national index slightly below 99 for the fifth consecutive month," said James Diffley, chief regional economist at IHS Markit.

"We're encouraged to see the rate of small business job growth holding steady, but finding qualified candidates remains a significant challenge for small businesses," said Martin Mucci, Paychex president and CEO. "According to a recent survey we conducted, to help address the labor skills gap, a majority of small business leaders say they're willing to consider hiring underqualified candidates who could then be trained on the job."

Broken down further by geography and industry, the April report showed:

• The South continues to lead regions in employment growth; the West remains the top region for hourly earnings growth exceeding three percent.
• Texas remains the strongest state for small business job growth; Missouri took first place among states for wage growth.
• Dallas is again the top metro for job growth; San Diego continues to lead metros for wage growth.
• Education and Health Services has increased its pace of small business employment growth in each month of 2019.

The complete results for April, including interactive charts detailing all data at a national, regional, state, metro, and industry level, are available at www.paychex.com/employment-watch. Highlights are available below.

National Jobs Index

• At 98.77, the national index was essentially unchanged from the previous month (-0.02 percent) and is down 0.77 percent from last year.
• Small business employment growth has held pace throughout the first four months of 2019, slowing just 0.03 percent per month.

National Wage Report

• Hourly earnings growth continues to moderate slightly, now at 2.50 percent. However, the last quarter has shown 2.78 percent annualized growth.
• One-month and three-month annualized growth rates for weekly earnings are above three percent for the first time in more than a year.

Regional Jobs Index

• With Texas, Tennessee, and Georgia among the top five states, the South leads all regions in small business employment growth (99.60).
• Though the Northeast continues to trend below other regions, the Northeast had its first positive month in more than a year, gaining 0.08 percent.
  

Regional Wage Report 

• Hourly earnings growth in the West has exceeded three percent since 2015, while the other regions remain below 2.50 percent.
• Due to increases in weekly hours worked, weekly earnings growth in the Northeast (2.51 percent) outpaces the West (2.41 percent).
• At 2.45 percent in April, weekly earnings growth has quickly improved in the South during 2019.
  

State Jobs Index

• Improving to 97.81, Massachusetts gained 0.39 percent from the previous month, its best one-month result since 2015. 
• After increasing 0.61 percent during the first quarter of 2019, Arizona lost its momentum, slowing 0.52 percent in April. 

Note: Analysis is provided for the 20 largest states based on U.S. population.

State Wage Report

• Missouri, California, New York, and Arizona are the only states above three percent in hourly earnings growth in April.
• Wage growth in Arizona has been decelerating since the beginning of 2018.

Note: Analysis is provided for the 20 largest states based on U.S. population.

Metropolitan Jobs Index 

• Seattle surged to third-ranked metro for small business employment growth, behind Dallas and Tampa, with an index slightly below 101 and a positive 12-month growth rate.
• Slowing to 100.35, Phoenix suffered the largest one-month decline among metros, down 0.58 percent.

 Note: Analysis is provided for the 20 largest metro areas based on U.S. population.

Metropolitan Wage Report

• San Diego and Riverside lead metros with annual hourly earnings gains above four percent.
• San Diego has a three-month annualized growth rate near six percent.
• Houston and Tampa trail metros with less than one and a half percent hourly earnings growth from a year ago.

 Note: Analysis is provided for the 20 largest metro areas based on U.S. population.

Industry Jobs Index

• With its best one month gain in nearly three years, the index for Construction surpassed 100, up 0.31 percent from the previous month.
• Education and Health Services has increased its pace of small business employment growth in each month of 2019 and has a positive 12-month growth rate for the first time in more than two years.

 Note: Analysis is provided for seven major industry sectors.

Industry Wage Report  

• Leisure and Hospitality has lead industry sectors in hourly earnings growth since the beginning of 2018 and is accelerating in 2019, with 4.46 percent growth in April.
• Manufacturing; Trade, Transportation, and Utilities; and Construction are also above three percent hourly earnings growth in April.  
  

Note: Analysis is provided for seven major industry sectors.

For more information about the Paychex | IHS Markit Small Business Employment Watch, visit www.paychex.com/employment-watch and sign up to receive monthly Employment Watch alerts.

*Information regarding the professions included in the industry data can be found at the Bureau of Labor Statistics website.

About the Paychex | IHS Markit Small Business Employment Watch
The Paychex | IHS Markit Small Business Employment Watch is released each month by Paychex, Inc., a leading provider of payroll, human resource, insurance, and benefits outsourcing solutions for small-to medium-sized businesses, and IHS Markit, a world leader in critical information, analytics, and expertise. Focused exclusively on small business, the monthly report offers analysis of national employment and wage trends, as well as examines regional, state, metro, and industry sector activity. Drawing from the payroll data of approximately 350,000 Paychex clients, this powerful tool delivers real-time insights into the small business trends driving the U.S. economy.

About Paychex
Paychex, Inc. (NASDAQ: PAYX) is a leading provider of integrated human capital management solutions for payroll, benefits, human resources, and insurance services. By combining its innovative software-as-a-service technology and mobility platform with dedicated, personal service, Paychex empowers small- and medium-sized business owners to focus on the growth and management of their business. Backed by more than 45 years of industry expertise, Paychex serves over 650,000 payroll clients as of May 31, 2018, across more than 100 locations in the U.S. and Europe, and pays one out of every 12 American private sector employees. Learn more about Paychex by visiting www.paychex.com, and stay connected on Twitter and LinkedIn.

About IHS Markit (www.ihsmarkit.com)
IHS Markit (Nasdaq: INFO) is a world leader in critical information, analytics and solutions for the major industries and markets that drive economies worldwide. The company delivers next-generation information, analytics and solutions to customers in business, finance and government, improving their operational efficiency and providing deep insights that lead to well-informed, confident decisions. IHS Markit has more than 50,000 business and government customers, including 80 percent of the Fortune Global 500 and the world's leading financial institutions. Headquartered in London, IHS Markit is committed to sustainable, profitable growth.

IHS Markit is a registered trademark of IHS Markit Ltd. and/or its affiliates. All other company and product names may be trademarks of their respective owners © 2019 IHS Markit Ltd. All rights reserved.

Media Contacts

Lisa Fleming
Paychex, Inc.
+1 585-387-6402
[email protected] 
@PaychexNews 

Kate Smith
IHS Markit
+1 781-301-9311
[email protected] 

Tess Flynn
Mower
+1 716-880-1488
[email protected] 

SOURCE Paychex, Inc.

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