The competitive small business job market continues to drive wage growth higher, according to the latest Paychex, IHS Markit Small Business Employment Watch.
Steady growth in hourly earnings and hours worked – with hours worked in December posting the strongest gains since 2012 – pushed weekly earnings growth to 4.13 percent, a new all-time high for employees of small businesses, according to the tracking survey.
“Small business job gains have flattened in the second half of the year as labor markets prove very tight,” said James Diffley, chief regional economist at IHS Markit. “In response, weekly earnings have accelerated, surging from 2.49 percent mid-year to 4.13 percent at year-end.”
“The new high in weekly earnings growth this month is certainly positive news for the employees of small businesses,” said Martin Mucci, Paychex president and CEO. “Not only are businesses raising wages, but they’re also increasing hours for their current employees, a sure sign that employers are responding to the pressures of the tight labor market.”
Additional findings from the December Small Business Employment Watch (2019)
The South | Leading region for small business employment growth
The West | Leading region for hourly earnings growth followed closely by the Northeast.
Tennessee | The leader among states in small business job growth
New York | The leader in hourly earnings growth at the state level
Dallas | The leader among metropolitan areas for small business job growth
Los Angeles | The leader among metropolitan areas for hourly earnings job growth
Leisure and Hospitality |Leading industry sectors in combined wage-growth components: hourly earnings, weekly earnings and weekly hours.
Source and more information: The Paychex-IHS Markit Small Business Employment Watch