Hourly earnings growth for U.S. workers
slows
ROCHESTER, N.Y., May 30, 2023
/PRNewswire/ -- The rate of small business job growth was unchanged
from April for the month of May, according to the latest Paychex |
IHS Markit Small Business Employment Watch. The national Small
Business Jobs Index — which measures the rate of small business job
growth in the U.S. — stands at 99.45, a 0.04% decrease from April.
Meanwhile, hourly earnings growth for U.S. workers slowed to
4.33%.
"Hourly earnings gains continue to decelerate while the small
business job market has been stable in 2023," said James Diffley, chief regional economist, S&P
Global Market Intelligence.
"Despite the challenges of a competitive labor market and
tightening credit, our data suggests small businesses remain
resilient as job growth holds steady," said John Gibson, Paychex president and CEO.
"Our data also shows a consistent trend of hourly earnings growth
slowing over 11 of the past 12 months, perhaps providing some
relief for businesses looking to hire."
In further detail, the May report showed:
- At 99.45, small business employment growth is 1.41% lower
compared to a year ago (100.87).
- Wage growth continues to fall nationally, with hourly (4.33%)
and weekly earnings growth (3.96%) both dropping in May.
- The South leads small business employment growth among regions
for the 14th consecutive month at 100.47.
- North Carolina leads job
growth among states for the 11th consecutive month at
101.48.
- Texas ranks first among states
for both hourly (5.46%) and weekly earnings growth (4.99%).
- Houston is once again the top
metro for small business job growth for the seventh straight month.
Houston also ranks first among
metros for hourly earnings growth (5.34 percent) in May.
- Construction is the top sector for all three wage data
components: hourly earnings growth (4.89%), weekly earnings growth
(5.00%), and weekly hours worked growth (0.35%).
Paychex solutions reach 1 in 12 American private-sector
employees, making the Small Business Employment Watch an industry
benchmark. Drawing from the payroll data of approximately 350,000
Paychex clients with fewer than 50 employees, the monthly report
offers analysis of national employment and wage trends, as well as
examines regional, state, metro, and industry sector activity.
The complete results for May 2023,
including interactive charts detailing all data, are available at
www.paychex.com/watch. Highlights are available below.
National Jobs Index
- After increasing each of the first three months in 2023, the
national index slowed 0.24% in April and moderated 0.04% in May to
99.45.
- At 99.45, small business employment growth is 1.41% lower
compared to a year ago (100.87).
National Wage Report
- The steady deceleration in hourly earnings growth continues in
May, with the rate slowing to 4.33%.
- Weekly earnings growth is now below 4.00% (3.96%), while one-
and three-month annualized growth are 2.42% and 2.40%,
respectively.
- Year-over-year weekly hours-worked growth continues its
moderation, falling to -0.36% in May.
Regional Jobs Index
- At 100.47, the South leads small business employment growth
among regions for the 14th consecutive month.
- All regions have slowed from a year ago, with the Northeast and
West both decreasing more than two percent year-over-year.
- At 98.86, the West has the weakest job growth rate among
regions — a title it has held since November
2022. However, it is the only region to improve in May
(0.14%).
Regional Wage Report
- At 4.52%, the South leads hourly earnings growth among regions
for the 10th consecutive month. The West (4.49%) and
Midwest (4.40%) trail closely behind.
- The Northeast ranks last among regions for hourly earnings
growth (4.26%) and is the only region with one-month annualized
growth below four percent (3.28%).
- Weekly hours worked growth is negative for all regions, with
the West the lowest (-0.69%).
State Jobs Index
- At 101.48, North Carolina
leads job growth among states for the 11th consecutive
month.
- The top three state indexes (North
Carolina, Georgia,
Texas) had the weakest one-month
change rates.
- Ranked among the bottom three states for all of 2022,
Ohio improved for the fifth
consecutive month to start 2023 and now ranks 11th among
states at 99.64.
Note: Analysis is provided for the 20 largest states based on
U.S. population.
State Wage Report
- Texas ranks first among states
for hourly earnings growth (5.46%) as well as weekly earnings
growth (4.99%).
- Indiana ranks last among
states for hourly earnings growth (3.82%), but first among states
for weekly hours worked growth (0.34%).
- At 4.93% in May, hourly earnings growth slowed below five
percent in Florida for the first
time since 2021.
- With consistently strong hourly earnings growth above five
percent during the past year, Wisconsin has slowly moved up the state
rankings to second place in May at 5.18%.
Note: Analysis is provided for the 20 largest states based on
U.S. population.
Metropolitan Jobs Index
- At 102.23, Houston ranks first
among metros for the seventh straight month. Consistently strong,
Houston has been above 101 since
August 2021.
- Texas metros Houston (-0.49%) and Dallas (-0.87%) had the weakest one-month
change rates among metros in May.
- Dallas' jobs index has slowed
6.21% from a year ago, from 105.33 in May
2022 to 98.80 in May
2023.
- Phoenix (101.23) is up 0.69%
from last year, the best 12-month change rate among metros.
Note: Analysis is provided for the 20 largest metro areas
based on U.S. population.
Metropolitan Wage Report
- Jumping four spots from April, Houston (5.34%) ranks first among metros for
hourly earnings growth in May. Minneapolis (5.14%) and Dallas (5.03%) also have hourly earnings
growth above five percent.
- San Francisco ranks last among
metros in hourly earnings growth (3.23%) and weekly earnings growth
(2.45%).
- Atlanta is in the bottom three
metros for hourly earnings growth (3.60%), weekly earnings growth
(2.47%), and weekly hours worked growth (-1.02%).
- Baltimore is the top-ranked
metro for weekly earnings and hours worked growth, 5.10% and 0.34%,
respectively.
Note: Analysis is provided for the 20 largest metro areas
based on U.S. population.
Industry Jobs Index
- With a modest 0.10% increase in May to 101.39, other services
(except public administration) maintains the top spot among
sectors.
- At 100.81, education and health services continued its strong
pace of small business employment growth in May, moderating just
0.03%.
- Leisure and hospitality remains strong at 100.52 in May, but is
3.38% behind its job growth pace set last year (104.04).
Note: Analysis is provided for seven major industry sectors.
Definitions of each industry sector can be found here. The other
services (except public administration) industry category includes
religious, civic, and social organizations, as well as personal
services, including automotive and household repair, salons,
drycleaners, and other businesses. The chart's dark blue bars
reflect the index level and the light blue diamonds reflect the
12-month change.
Industry Wage Report
- Construction is the top sector for all three wage data
components:
-
- Hourly earnings growth (4.89%)
- Weekly earnings growth (5.00%)
- Weekly hours worked growth (0.35%)
- Education and health services has the weakest earnings growth
among sectors, with hourly earnings growth of 3.69% and weekly
earnings growth of 2.92%.
- Hourly earnings growth in leisure and hospitality (4.74%)
slipped below five percent for the first time in more than two
years. Leisure and hospitality averaged 7.75% hourly earnings
growth from April 2021 through
April 2023.
Note: Analysis is provided for seven major industry sectors.
Definitions of each industry sector can be found here. The other
services (except public administration) industry category includes
religious, civic, and social organizations, as well as personal
services, including automotive and household repair, salons,
drycleaners, and other businesses.
For more information about the Paychex | IHS Markit Small
Business Employment Watch, visit www.paychex.com/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 S&P Global
Market Intelligence, a Division of S&P Global (NYSE: SPGI),
which merged with IHS Markit in 2022 and is a provider of
information services and solutions to global markets. 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 human
resources, payroll, benefits, and insurance services. By combining
innovative software-as-a-service technology and mobility platform
with dedicated, personal service, Paychex empowers business owners
to focus on the growth and management of their business. Backed by
50 years of industry expertise, Paychex serves more than 730,000
payroll clients as of May 31, 2022,
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 S&P Global Market Intelligence
At S&P
Global Market Intelligence, we understand the importance of
accurate, deep, and insightful information. Our team of experts
delivers unrivaled insights and leading data and technology
solutions, partnering with customers to expand their perspective,
operate with confidence, and make decisions with conviction.
S&P Global Market Intelligence is a division of S&P
Global (NYSE: SPGI). S&P Global is the world's foremost
provider of credit ratings, benchmarks, analytics and workflow
solutions in the global capital, commodity and automotive markets.
With every one of our offerings, we help many of the world's
leading organizations navigate the economic landscape so they can
plan for tomorrow, today. For more information,
visit www.spglobal.com/marketintelligence.
Media Contacts
Chris
Muller
Paychex, Inc.
585-338-4346
cmuller@paychex.com
@Paychex
Kate Smith
S&P Global Market Intelligence
+1 781-301-9311
katherine.smith@spglobal.com
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SOURCE Paychex, Inc.