ROCHESTER, N.Y., Jan. 4, 2022 /PRNewswire/ -- Workers saw
record hourly earnings growth and employment levels continued to
rise as 2021 drew to a close. This is according to the aggregated
payroll data of approximately 350,000 Paychex clients with fewer
than 50 employees, released monthly in the Paychex | IHS Markit
Small Business Employment Watch. The December data shows hourly
earnings growth improved to 4.27 percent, the highest level since
reporting began ten years ago. Hiring at small businesses also
ended the year on a high note with the Small Business Jobs Index
improving 7.31 percent from the prior year and 0.22 percent for the
month.
"Small business employment continues to rise as we end 2021,
contributing jobs and rapid earnings growth to our sharp recovery
from the COVID-19 downturn," said James
Diffley, chief regional economist at IHS Markit.
"Over the past several months, we've seen steady and sustained
increases in our hourly earnings growth. In December, average
hourly earnings reached $30.00, "
said Martin Mucci, Paychex CEO.
"Employers are responding to the pressures of the tight labor
market by raising wages and workers are benefiting."
In further detail, the December report showed:
- Hourly earnings growth and weekly earnings growth are both
above four percent. Each measure was at less than three percent
growth as recently as June.
- Hourly earnings grew 4.27 percent during 2021, resulting in an
average hourly wage of $30.00.
- Hourly earnings growth exceeded four percent in all regions of
the U.S.
- Leisure and hospitality hit double-digit hourly earnings growth
(10.69 percent) to lead all industry sectors.
- The Small Business Jobs Index increased to 100.94 in December,
its highest level since August 2014.
The rate of growth, however, has slowed for the past two months
(0.50 percent in October, 0.27 percent in November, and 0.22
percent in December).
- The West overtook the South as the top region for small
business employment growth.
- Texas remained the top state
for small business hiring, and Dallas the top metro.
Paychex business solutions reach 1 in 12 American
private-sector employees, making the Small Business Employment
Watch an industry benchmark. Drawing from the payroll data of
approximately 350,000 Paychex clients with fewer than 50 employees,
the monthly report offers analysis of national employment and wage
trends, as well as examines regional, state, metro, and industry
sector activity.
The complete results for December, including interactive charts
detailing all data, are available at www.paychex.com/watch.
Highlights are available below.
National Jobs Index
- The national index added another strong gain (0.22 percent),
increasing from 100.72 in November to 100.94 in December.
- The national index recorded its seventh consecutive gain to end
2021.
- The national index has gained a record high 7.31 percent during
the past 12 months as small businesses continue to recover from the
coronavirus pandemic.
National Wage Report
- Rising to $30.00 in December,
hourly earnings gained $1.23 (4.27
percent) during 2021.
- Weekly earnings growth improved to 4.14 percent in December,
joining hourly gains of 4.27 percent. Both measures were less than
three percent as recently as June.
- While year-over-year growth remains slightly negative (0.16
percent), weekly hours worked have increased for three consecutive
months.
Regional Jobs Index
- At 101.22, the West has the highest regional index in December
and improved for the tenth consecutive month.
- The South (101.08) fell to second among regions and was the
only region to slow in December, largely due to a decrease (0.43
percent) in the East South Central division.
- With the Midwest gaining 0.49 percent in December, each
regional index is above 100.
Regional Wage Report
- Hourly earnings growth in December exceeded four percent in all
regions.
- With the national earnings now at $30/hour, differences can be seen by region. The
Midwest and South are slightly over $28/hour, while the West and Northeast are above
$31/hour.
- Weekly hours worked growth is up 0.02 percent in the Northeast,
the only region with positive year-over-year growth. All regions,
however, are trending in a positive direction with one-month
annualized growth over two percent.
State Jobs Index
- Once again, Texas,
North Carolina, and Arizona each had index levels that exceeded
102.
- The index levels for Michigan
and Illinois passed the 100 mark
in December for the first time since 2018.
- Tennessee (97.23) fell 1.03
percent in December, solidifying its place at the bottom of the
state rankings for the year. While most states have steadily
recovered, the Tennessee index
slowed in 10 out of the 12 months of 2021.
- New York posted its tenth
index increase of 2021, gaining 0.41 percent to 100.77.
New York ranks in the top ten
among states for the first time since 2016.
Note: Analysis is provided for the 20 largest states based on
U.S. population.
State Wage Report
- Weekly earnings growth in Florida improved to 5.01 percent, the only
state above five percent.
- North Carolina, Ohio, and Tennessee reported hourly earnings growth
above five percent in December, topping the state rankings. The
same states each ranked in the bottom five for weekly hours worked
growth.
- Michigan (2.44 percent) and
Maryland (2.54 percent) are the
only two states with weekly earnings growth below three
percent.
Note: Analysis is provided for the 20 largest states based on
U.S. population.
Metropolitan Jobs Index
- Dallas remained the top metro
for small business job growth for the fourth consecutive month,
with an index level consistently above 104.
- Minneapolis jumped 1.76
percent in December, its fourth increase of more than one percent
in 2021. At 103.63, the Minneapolis index trails only Dallas and is up 12.33 percent from last year,
best among metros.
- Denver fell 1.72 percent in
December to 97.24, making its index last among metros. After
ranking seventh among metros in June, Denver has steadily fallen during the past two
quarters of 2021.
Note: Analysis is provided for the 20 largest metro areas
based on U.S. population.
Metropolitan Wage Report
- Denver topped all metros in
hourly and weekly earnings growth, both above six percent. However,
Denver has the lowest index among
metros for small business employment growth.
- Seattle, Baltimore, and Houston are the only three metros with hourly
earnings growth below three percent.
- Houston ranks first among
metros for weekly hours worked growth, increasing 0.80 percent in
December.
- Weekly hours worked growth is trending in the right direction
as ten of the twenty metros analyzed now have positive
year-over-year growth, up from just three metros in November.
Note: Analysis is provided for the 20 largest metro areas
based on U.S. population.
Industry Jobs Index
- The leisure and hospitality index (105.68) gained 1.39 percent
in December and 21.36 percent during the past year.
- With four industries decreasing in December (construction,
education and health services, manufacturing, and financial
activities), the national increase was heavily influenced by strong
gains in leisure and hospitality and other services (except public
administration).
- Construction and financial activities ended 2021 with index
levels below 99, recovering only a little more than one percent
during the year.
Note: Analysis is provided for seven major industry sectors.
Definitions of each industry sector can be found here. The other
services (except public administration) industry category includes
religious, civic, and social organizations, as well as personal
services, including automotive and household repair, salons,
drycleaners, and other businesses.
Industry Wage Report
- Leisure and hospitality hit double-digit hourly earnings growth
(10.69 percent) to lead all sectors. Trade, transportation, and
utilities ranks second at 5.56 percent.
- With education and health services improving to 3.00 percent in
December, all sectors have hourly earnings growth at or above three
percent.
- Weekly earnings growth is just 2.18 percent in the education
and health services industry, six times lower than the leisure and
hospitality growth rate (13.29 percent).
Note: Analysis is provided for seven major industry sectors.
Definitions of each industry sector can be found here. The other
services (except public administration) industry category includes
religious, civic, and social organizations, as well as personal
services, including automotive and household repair, salons,
drycleaners, and other businesses.
For more information about the Paychex | IHS Markit Small
Business Employment Watch, visit www.paychex.com/watch and sign up
to receive monthly Employment Watch alerts.
*Information regarding the professions included in the
industry data can be found at the Bureau of Labor Statistics
website.
About the Paychex | IHS Markit Small Business Employment
Watch
The Paychex | IHS Markit Small Business Employment
Watch is released each month by Paychex, Inc., a leading provider
of integrated human capital management software solutions for human
resources, payroll, benefits, and insurance services, and IHS
Markit, a world leader in critical information, analytics, and
expertise. Focused exclusively on small business with fewer than 50
employees, the monthly report offers analysis of national
employment and wage trends, as well as examines regional, state,
metro, and industry sector activity. Drawing from the payroll data
of approximately 350,000 Paychex clients, this powerful tool
delivers real-time insights into the small business trends driving
the U.S. economy.
About Paychex
Paychex, Inc. (Nasdaq: PAYX) is a
leading provider of integrated human capital management software
solutions for human resources, payroll, benefits, and insurance
services. By combining its innovative software-as-a-service
technology and mobility platform with dedicated, personal service,
Paychex empowers small- and medium-sized business owners to focus
on the growth and management of their business. Backed by 50 years
of industry expertise, Paychex served more than 710,000 payroll
clients as of May 31, 2021 across
more than 100 locations in the U.S. and Europe, and pays one out of every 12 American
private sector employees. Learn more about Paychex by visiting
paychex.com and stay connected on Twitter and LinkedIn.
About IHS Markit (www.ihsmarkit.com)
IHS Markit (NYSE: INFO) is a world leader in critical information,
analytics and solutions for the major industries and markets that
drive economies worldwide. The company delivers next-generation
information, analytics and solutions to customers in business,
finance and government, improving their operational efficiency and
providing deep insights that lead to well-informed, confident
decisions. IHS Markit has more than 50,000 business and government
customers, including 80 percent of the Fortune Global 500 and the
world's leading financial institutions. Headquartered in
London, IHS Markit is committed to
sustainable, profitable growth.
IHS Markit is a registered trademark of IHS Markit Ltd.
and/or its affiliates. All other company and product names may be
trademarks of their respective owners © 2021 IHS Markit Ltd. All
rights reserved.
Media Contacts
Lisa
Fleming
Paychex, Inc.
+1 585-387-6402
lfleming@paychex.com
@Paychex
Kate Smith
IHS Markit
+1 781-301-9311
katherine.smith@ihsmarkit.com
Maggie Pryslak
Mower
+1 585-576-1083
mpryslak@mower.com
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SOURCE Paychex, Inc.