Saturday 26 November 2022
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Small Business Growth Stagnates in the United States

Pen on the newspaper career opportunity ad.A Rochester-based human resources company just released data indicating the national growth of small business employment went down last month in the United States.

Business Wire reports that the Paychex/IHS Small Business Jobs Index decreased by 0.17% in May, making the national average 100.65. The May dip has resulted in a three-month growth rate of -0.18%.

Paychex, Inc. is a Rochester-based human resources company that, along with Colorado analytics company IHS Inc., releases a monthly index that calculates the rate of job growth in small businesses across the United States. Human resource companies such as Paychex, Inc. are recommended by 85% of certified public accountants for small businesses.

“The Paychex/IHS Small Business Index dropped 0.17 percent in May, reverting to its January 2015 level. While the national index is well below the level set throughout most of 2014, small businesses are expanding to be sure, but at a rate consistent with the growth seen in 2012,” said James Diffley, chief regional economist at IHS.

Though the national index is down, some regions of the country are doing comparatively well. The East North Central Region, for example, is the leading region in job growth, averaging a 0.77% increase in growth from February to May. With an index of 100.80, it was the only region to improve in May.

In terms of individual states, Indiana shows the most promise in small business employment. It leads the states in terms of best one-month and one-year growth rates, and it currently has an index of 103.65.

In terms of metropolitan/local areas, Dallas leads the way with an index above 104 and the best one-year growth rate among every measured city. Washington D.C. showed the most improvement of any city, increasing its index by 0.64 from April to May to reach a four-year high.

In terms of the worst-performing cities, Boston ranks dead last among major metropolitan areas, reaching a disconcerting index of 98.61.

What do these figures indicate? Martin Mucci, the president and CEO of Paychex, claims that the rates could be better but that they show some promise over extended periods of time.

“May’s index results seem to be in line with the story of the overall economic recovery: moderate, but somewhat inconsistent growth,” Mucci said. “While it’s not ideal to see the growth rate slowing, we’ll need to see how this trend plays out over the long term.”