CLEVELAND--(CBIZ Small Business Employment Index (SBEI), a barometer for hiring trends for more than 3,500 companies with 300 or fewer employees, decreased by 0.89 percent during October, following a decrease of 2.55 percent in September.)--The
“Although the actual SBEI metric shows a decline of 0.89 percent, the number of companies hiring exceeded those decreasing employment. At a minimum, we can view this month’s numbers as stable in terms of small business employment levels, but the number of firms hiring is encouraging”
With the presidential election next week, the small business sector of the economy continues to attract headline coverage. Job creation, the health of our economy and the middle class are at the crux of both presidential campaigns. The SBEI is focused on this portion of our economy and is a critical component to understanding domestic economic trends.
ADP’s October jobs survey revealed that the private sector added 158,000 jobs, exceeding analysts’ estimates and surpassing September’s revised tally of 114,000 added jobs.
“Although the actual SBEI metric shows a decline of 0.89 percent, the number of companies hiring exceeded those decreasing employment. At a minimum, we can view this month’s numbers as stable in terms of small business employment levels, but the number of firms hiring is encouraging,” says Philip Noftsinger, business unit president for CBIZ Payroll Services.
To view and/or use a graphic illustration that tracks and illustrates the employment index, visit our blog here.¹
Additional take-away points from the October data set include:
- At-a-glance: Of the companies surveyed, 25 percent increased staffing while 24 percent of the companies decreased employee headcounts. 51 percent of the companies surveyed maintained their number of employees.
- Small business sector: If firms continue to see growth in demand as well as a resolution to the fiscal cliff, there is a strong chance we could see positive movement in employment during the fourth quarter.
- What-to-watch: A critical issue is the ability of our leadership in Washington to deal with the pending fiscal cliff and remove uncertainty from the marketplace. Our country’s leadership must enact a longer term solution, rather than simply moving the deadline out another year.
“Businesses want longer term predictability, similar to what the Fed Chairman is projecting with regards to interest rates. Small business owners are more adept at long-term planning than they were pre-recession, and they are not motivated by short-term solutions to major economic issues and the volatility they present,” says Noftsinger.
CBIZ Payroll Services manages payroll services for more than 3,500 businesses. Its index reflects a broad array of industries and geographies corresponding to the markets across the United States where CBIZ provides human capital services. The data represented by the SBEI is derived from a segment of employers not completely accounted for by the ADP and Federal BLS employment reports.
(1) The SBEI illustration is licensed under a Creative Commons Attribution-NoDerivs 3.0 Unported License. Based on a work at http://blog.cbiz.com.
(2) The United States Department of Labor’s Bureau of Labor Statistics Employment Situation Summary is due to be released on Friday, November 2, at 8:30 a.m. ET. Mr. Noftsinger is available for media interviews to discuss employment trends and other payroll matters impacting the American business environment.
About CBIZ, Inc. (NYSE:CBZ)
CBIZ, Inc. provides professional business services that help clients better manage their finances and employees. CBIZ provides its clients with financial services including accounting, tax and consulting, internal audit, merger and acquisition advisory and valuation services. Employee services include employee benefits consulting, property and casualty insurance, retirement plan consulting, payroll, life insurance, HR consulting, and executive recruitment. CBIZ also provides outsourced technology staffing and support services, healthcare consulting, and medical practice management. As one of the largest benefits specialists and one of the largest accounting, valuation, and medical practice management companies in the United States, the Company’s services are provided through more than 130 Company offices in 37 states. Visit our website at www.cbiz.com and our blog, “Human Capitalizing,” at http://blog.cbiz.com.