Small Business Hiring Rebounds in August After Two Consecutive Months of Decline
The CBIZ Small Business Employment Index reports August job growth, but concerns loom as economic indicators signal potential trouble ahead
The Bureau of Labor Statistics’ employment report indicated hiring growth that missed expectations. The August reading showed an overall increase of 142,000 private-sector jobs. The national unemployment rate fell slightly to
"This summer's data reflects a weakening labor market,” said Anna Rathbun, CFA, Chief Investment Officer, CBIZ Investment Advisory Services, LLC. “The Job Openings and Labor Turnover Survey (JOLTS) report for July showed job openings at their lowest level since early 2021, while the ADP report for August fell below expectations, and the BLS report disappointed with further downward revisions. We are at a point where we can no longer say with confidence that the labor market is merely correcting from the post-pandemic surge. The data indicates a softening economy, with leverage shifting from employees back to employers."
Regionally, the Southeast (
On an industry level, Educational Services; Technology and Life Sciences; and Transportation saw an uptick in hiring. Accommodation and Food Services; Agriculture, Forestry, Fishing and Hunting; and Insurance reported the largest job losses.
Rathbun added, “August saw a broad gain in job growth across a diverse range of industries, providing some relief following the declines experienced in June and July. As we head into the final quarter of the year, the sustainability of these gains remains uncertain, especially with economic indicators suggesting potential challenges ahead. The coming months will be crucial in determining whether this upward trend in hiring can be maintained.”
To view an infographic with data from the employment index, visit the CBIZ website.
Additional takeaways from the August SBEI include:
August’s snapshot:
Industries at-a-glance: In August, hiring increases were led by Educational Services; Technology and Life Sciences; and Transportation. The largest losses were seen in Accommodation and Food Services; Agriculture, Forestry, Fishing and Hunting; and Insurance
Geographical hiring: The Southeast (
What’s next? What stands out is that employers are retaining workers at the highest rate since the post-pandemic labor shortage began. Before the pandemic, the CBIZ Small Business Employment Index showed an average retention rate of
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.
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Alex Ortiz
Gregory FCA for CBIZ
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Source: CBIZ