Small Businesses Report Modest Hiring Growth in December
January 10 2023 - 8:30AM
Business Wire
The CBIZ Small Business Employment Index
reported an increase in hiring in December, signaling a positive
sentiment from small business owners
The CBIZ Small Business Employment Index (“SBEI”) reported a
seasonally adjusted increase of 0.84% in December. The previous
downward trend in hiring reversed in November and December,
signaling a positive sign for small business owners going into the
new year. The CBIZ SBEI tracks payroll and hiring trends for over
3,500 companies that have 300 or fewer employees, providing broad
insight into small business trends.
“From a seasonal perspective, December's hiring data was weaker
than expected”, said Anna Rathbun, CFA, Chief Investment Officer,
CBIZ Investment Advisory Services, LLC. “December typically sees
increased seasonal hiring due to the holiday season, and the pace
for hiring this month was less than expected for this time of year.
But, this data is also in sync with the pattern of worse than
expected holiday sales in the retail sector, and generally in line
with the recessionary narrative.”
The Bureau of Labor Statistics’ employment report indicated
hiring growth that beat expectations. The December reading showed
an overall increase of 223,000 private-sector jobs. Despite the
overall hiring growth, the national unemployment rate remained
stagnant with only a minor reduction to 3.5%. The report is
inclusive of all non-farm private employers across businesses of
all sizes. Meanwhile, the ADP employment report showed an overall
increase of 235,000 private-sector jobs for the month. Small
businesses accounted for an increase of 195,000 of those jobs on a
seasonally adjusted, month-over-month basis. The ADP report counts
small businesses as companies with 49 or fewer employees, while the
CBIZ SBEI uses data from companies with 300 employees or fewer.
The CBIZ SBEI regional data showed a hiring increase in every
region of the United States in December. The West (1.25%) reported
the largest hiring increase, followed by the Central (1.18%),
Southeast (0.35%) and Northeast (0.18%) regions.
From an industry perspective, the most notable hiring increases
were seen in Healthcare, Non-Profit, and Wholesale Distribution.
Arts, Entertainment and Recreation, Technology and Life Sciences,
and Utilities all experienced declines in hiring.
“After nearly two years of dealing with labor shortage, small
business owners may have an easier time staffing in the coming
months,” added Rathbun. “The recessionary mood may give employers a
better opportunity to properly staff their business because workers
are less likely to leave.”
To view an infographic with data from the employment index,
visit the CBIZ website.
Additional takeaways from the December SBEI include:
December's snapshot: 24% of companies in the index
increased staffing, 57% made no change to their headcounts and 19%
reduced employment totals.
Industries at a glance: Healthcare, Non-Profit, and
Wholesale Distribution saw hiring gains. Decreases were seen in
Arts, Entertainment and Recreation, Technology and Life Sciences,
and Utilities.
Geographical hiring: The West (1.25%), Central (1.18%),
Southeast (0.35%) and Northeast (0.18%) regions all experienced
hiring increases.
What’s next? Small business hiring has experienced modest
growth following a reversal in the downward trend seen in previous
months. However, with seasonal hiring showing signs of weakness,
the momentum may shift in 2023 as recession fears continue.
Editor’s note: (1) The SBEI illustration is licensed
under a Creative Commons Attribution-NoDerivs 3.0 Unported License.
Based on our work at https://www.cbiz.com.
Follow CBIZ on Twitter at @CBZ or on Facebook.
About CBIZ CBIZ, Inc. is a leading provider of financial,
insurance and advisory services to businesses throughout the United
States. Financial services include accounting, tax, government
health care consulting, transaction advisory, risk advisory, and
valuation services. Insurance services include employee benefits
consulting, retirement plan consulting, property and casualty
insurance, payroll, and human capital consulting. With more than
100 Company offices in 32 states, CBIZ is one of the largest
accounting and insurance brokerage providers in the U.S. For more
information, visit www.cbiz.com.
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Media Alex Ortiz Gregory FCA for CBIZ
Alexo@gregoryfca.com 610-228-2119
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