The October CBIZ Small Business Employment Index (SBEI), a barometer for hiring trends among companies with 300 or fewer employees, further decreased by 1.28 percent through the month, after posting a decrease of .81 percent in September. The announcement follows ADP's October jobs survey, which illustrated that the private sector added 114,000 jobs in October. However, this number is down from a hiring increase of 122,000 new jobs recorded in September.
Of the companies that were surveyed, the data shows that 28 percent reported a decrease in employee headcount while 22 percent increased staffing. Fifty percent of the companies involved in the survey maintained their number of employees. Philip Noftsinger, business unit president for CBIZ Payroll Services, explained this month's SBEI results show a steeper decline than in September, indicating that job growth at the small business level is still struggling."
Additional results from the October data found small business owners continue to remain hesitant in bringing in new employees, especially amidst global economic concern and bleak domestic market outlook. However, the report noted with consumer spending likely to heighten during the holiday season, it could accelerate economic activity and confidence. A pickup in consumer spending could help to propel the economy forward and increase employer sentiment when it comes to hiring.
"In many cases, employers facing a year-end calendar may be opting to slow the replacement process for positions opened due to voluntary attrition in an effort to boost net income. We should see some stabilization to the numbers as we move into the holiday season and hope for job growth during that period as well," Noftsinger said.
On the flip side, small business owner optimism leapt 20 percent in October, to 53 percent, from a record-low the previous month, according to SurePayroll's monthly Small Business Scorecard. The scorecard includes hiring and wage data for the top 35 U.S. metropolitan statistical areas and surveys national small business owner optimism each month.
For October, the scorecard revealed that on a national level there continues to be flat or decreased hiring for the 13th month in a row, totaling a year-to-date decline in hiring of 2.9 percent. However, the company noted this downward turn is slowing since September. Wages remain down slightly (0.6 percent) for the year.