A recent report focused exclusively on small business has found wages from jobs at small businesses are going up nationally, but the amount of jobs is going down.
The report by Paychex, a payroll, human resource, insurance and benefits outsourcing solutions provider for small-to medium-sized businesses, and IHS Markit, a provider of critical information, analytics and expertise, shows a Small Business Jobs Index at its lowest level since late 2011.
June 2017 Small Business Employment Statistics
According to the Small Business Employment Watch compiled by the two companies, the Small Business Jobs Index that provides monthly insight into the small business employment trends driving the U.S. economy decreased 0.24 percent to 100.10 in June. June marked four consecutive months of decline in small business job growth, with a continued increase in wages.
“Small business job gains have slowed, consistent with tightening labor markets,” said James Diffley, chief regional economist at IHS Markit in a press statement announcing the study findings. “Wage gains continue at a moderate pace, up 2.88 percent from last year.”
Some of the wage gains can be attributed to recent minimum wage increases taking effect across the nation, including in California, New York and Seattle. Ongoing Senate spar over minimum wage legislation has also been cited as having an impact on jobs going down and wages increasing.
“Over the past month we’ve seen continued uncertainty as it relates to legislative policies that stand to impact small businesses,” said Martin Mucci, Paychex president and CEO. “The decline in this month’s index and modest growth in wages seem to reflect an unclear regulatory picture combined with a narrowing labor market.”
Paychex drew from the payroll data of approximately 350,000 of its clients to prepare the report. It analyzed national employment and wage trends, as well as state, regional, metro, and industry sector trends.
If a business hardly have any money to pay the higher wages, a solution is just to cut the number of people that are employed.