Intuit reported Wednesday that small businesses with fewer than 20 employees created 30,000 new jobs in August, but overall saw revenue declines.
The data is based on approximately 83,500 small businesses customers of Intuit Online Payroll and anonymized aggregated data from QuickBooks Online.
Small business revenues are gradually recovering from recessionary depths, but are just now reaching levels seen before the recession began in 2007, according to the Intuit Small Business Revenue Index.
Small business revenue fell by 0.6 percent from the previous month. The retail industry, along with the accommodation and food services sector, saw the biggest declines at 1.1 percent respectively, followed by real estate services at 0.7 percent. Average monthly compensation grew by 0.08 percent, or $2, down from the growth of $7 seen last month. Average monthly hours worked decreased by 0.6 percent, or 42 minutes.
“This month’s indexes indicate that small businesses are hurting,” said Susan Woodward, the economist who worked with Intuit to create the indexes. “The employment rate has been slowing since April, and revenues have been falling since March, declining 2.7 percent from its most recent peak. At an annual rate, this is a decline of just over 6 percent, which is substantial.”
Small businesses overall experienced declines in revenue in July. The health care and social assistance sector continued to see the smallest decline of all the industries, at 0.4 percent, though the rate of decline was 10 times more than the 0.04 percent decline seen in the previous month.
Among the industry sectors tracked by Intuit, the hardest hit recently has been small business retail, whose revenue has declined 6.1 percent from January to July, Woodward noted. The sector with the smallest decline is health care, which fell 1.3 percent from December 2011.
Based on August’s numbers and revised national employment data from the Bureau of Labor Statistics, Intuit revised upward the previously reported July growth rate to 0.2 percent from 0.17 percent. This equates to 45,000 jobs added in July, up from a previously reported 35,000 jobs, though these numbers are expected to change once the index is recalibrated.
Small business hourly employees worked an average of 106.4 hours in August, a decrease of 0.6 percent, or about 42 minutes, from the revised figure of 107.1 hours in July, making for a 24.5-hour workweek.
Average monthly pay for all small business employees rose to $2,737 in August, an increase of 0.08 percent, or $2, from the July revised figure of $2,735 per month. The equivalent annual wages would be about $32,800 per year, which is part-time work for many small business employees.
The Employment Index indicated growth in overall employment in August for all regions except for the West North Central and the Middle Atlantic divisions, which decreased by 0.17 percent and 0.10 percent respectively. A state-by-state breakdown showed the largest employment increases in Washington and Michigan, while Missouri saw the largest decrease and North Carolina remained flat.
