February's small-business employment slightly grew as employees brought in more money and worked more hours, according to recent research by Intuit.

Despite this slight growth, small-business revenues still fell, especially in the retail industry where there was the largest decline, the research finds. Overall, employment grew by 0.07 percent in February with 15,000 new jobs, marking an annualized growth rate of 0.8 percent. Meanwhile, average monthly compensation rose by 0.4 percent in February on a seasonally adjusted basis to $12 as opposed to the $6 decrease recorded in January. The research also finds that average monthly hours worked increased 0.17 percent, totaling to 12 minutes, in comparison to the drop of almost one hour reported in January.

"Small-business employment has risen by 75,000 jobs from this same time last year," says economist Susan Woodward. "However, if small-business employment were growing at its usual proportionate rate of 15 percent of national employment, that number would be 300,000 – a 400 percent difference. The housing bust that was at the center of the economic collapse hurt small business much more than it did big business.

"In nonrecession times, construction industry jobs make up about 5 percent of all employment, but it comprises nearly 20 percent of jobs in the small-business and self-employed segment. Single-family home construction, which was at 2 million houses per year in 2006, is now below 900,000 per year. Until construction truly recovers, we will not see robust recovery in small-business employment."

On average, small-business hourly employees worked 109.4 hours in February, a slight jump from the revised figure of 109.2 hours in January, coming to a 25.3-hour workweek. For small-business employees, average monthly pay rose to $2,745 in January, an increase from 0.4 percent from the January revised figure of $2,733 per month. This equates to annual wages of about $32,900 per year, which is part-time work for nearly of small-business employees.

According to a state-by-state breakdown of employment growth, results were inconsistent in February. Of the 34 states measured by the research, 13 states recorded gains, three remained flat and 18 dropped. Similar to January, Utah and Nevada experienced the largest increases while Alabama, Indiana and Kentucky faced the greatest declines.

Instant Insights /

Small-business employment slowly picks up

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