The SBEI’s decrease illustrates a slight slowdown in small business hiring as compared to reports from the private sector that the job market was holding up. ADP’s July jobs survey reported the private sector added 163,000 jobs last month, which surpassed analysts’ estimates of 120,000. Additionally, June’s revised tally of 176,000 jobs added also exceeded analysts’ estimates.
A breakdown of key metrics from the small businesses surveyed in July include:
|Click graph for a larger image of SBEI results|
- 22 percent reported an increase in employee headcount
- 29 percent decreased staffing
- 49 percent maintained their number of employees
As the presidential election heats up, the nation's unemployment rate will certainly be one of the most discussed economic indicators. Should the jobless rate remain unchanged at 8.2 percent, the small business sector could suffer further losses ahead. Coupled with rising costs of doing business, the sector faces uncertainty.
In addition, owners of businesses with less than 300 total employees are still focused on, and concerned with, anticipated sales, taxes and regulation. It is possible that if the entrepreneurs we work with were able to better predict the changes to the latter two items, via action by Congress, they may be willing to invest in additional labor. Predictability is extremely important for the small business owner, who after three years of slow economic activity, is operating with few resources.
Additional information on these findings can be found in July's Small Business Employment Index press release.
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