“The Paychex | IHS Small Business Jobs Index indicates small business employment conditions are beginning 2017 on firm footing, recovering from a slowdown of gains during the fall months,” declared James Diffley, Chief Regional Economist at IHS. This statement reflects the January results of the Paychex IHS Small Business Jobs Index. The monthly report identifies and tracks small business employment trends using real small business payroll data from the Paychex client base comprised of 350,000 small businesses nationwide having less than 50 employees.
In the January 2017 report, the national small business job index showed a 0.13% improvement following the .10 percent in December, achieving first time back to back monthly increases since the prior February. The national index now stands at 100.62, which was the average index of 2016. More notably, while the index has had minor fluctuations month to month, it now has shown “strong job gains for more than 60 consecutive months dating back to 2011” suggesting that 2017 will continue this trend.
Other key data showed:
- All 9 regions of the US showed an increase in the index for January, except for the South Atlantic, which had a slight decrease of 0.09 percent. Despite this decrease small business job growth remains on a positive trend strongly in the south. The Middle Atlantic region starts 2017 at a peak index level in more than three years, while New England remains the second-lowest ranked index among regions, though it has shown two strong increases in the past two months.
- State employment performance was somewhat mixed as four of the top five states decreased in January, while nine of the bottom 10 states improved. Florida continues its solid trending with an index of 101.90, up 0.01 percent from last month and 0.06 percent from last year. At 104.17, Tennessee had the strongest index and growth rates among states. Next in the rankings, small business job growth has been strong in Georgia and Washington with indexes above 102. A range of states remain below the baseline mark of 100: Illinois, Arizona, Wisconsin, California, and Texas.
- The top 3 ranked metros of Atlanta, Seattle, and Dallas all saw vastly different performance over the past few months. Atlanta saw steady increases while Seattle had dramatic decreases over the past three months. Dallas possessed the worst 12-month growth rate among metros however the past four months saw consecutive increases. With an index value of 97.78, Houston is ranked worst among metros but saw some positive changes in December and January.
- Among industries, Other Services (except Public Administration) stood far ahead of the other 7 ranked industries, having a value of 104.73. Education and Health Services ranked second, its highest ranking since 2012. Trade, Transportation, and Utilities saw a strong start to the year at above 100, a value it only had for one month throughout all 2016. Manufacturing had the best one month gain, yet the industry still possessed the worst 12-month growth rate and has not had consecutive year-to-year growth since 2014. With the lowest rankings, Manufacturing, Financial Activities, and Professional and Business services are all currently below 100.