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November

100.38

-0.04% 12-month change

Paychex | IHS Small Business Jobs Index Moderates in July, Following 2016 Peak in June

Rochester, N.Y. (August 2, 2016) – Following a 2016 high point in June, the Paychex | IHS Small Business Jobs Index moderated in July, down 0.12 percent from the previous month. At 100.68, the growth rate of the national index is consistent with the 2016 average and 0.04 percent higher than it was in July 2015. During the past 12 months, small business employment in the regions on the East Coast strengthened. Up 0.52 percent for the past three months, South Atlantic remained in the top spot among regions and is up 0.80 percent year-over-year. Washington remained the top-ranked state index at 103.63, but was unable to maintain the pace set in June, slipping 0.83 percent. At the top of the metro ranking, Seattle and Atlanta mirror their state indexes, with Seattle slowing and Atlanta gaining significantly. Employment growth slowed in eight of the nine industries in July, with Trade, Transportation and Utilities being the only industry sector to increase.

“At 100.68, the Paychex | IHS Small Business Jobs Index decreased to a level consistent with the 2016 average rate of small business job growth,” said James Diffley, chief regional economist at IHS.

“Following significant swings in the previous two months, the July index reflects a year-to-date trend of steady employment growth,” said Martin Mucci, president and CEO of Paychex. “That may sound contrary to the general belief that the uncertainty of a general election negatively impacts hiring. However, our research indicates that’s largely dependent on the size of the business, with larger companies citing the election as a key factor impacting decisions to add staff.”

The July 2016 Paychex | IHS Small Business Jobs Index

National Index

National Index

After a sizable decline in May and significant increase in June, the Paychex | IHS Small Business Jobs Index settled in the middle at 100.68 for July. The national index started the year at 100.65 and has maintained that pace of growth in July. Hitting a 2016 peak in June at 100.81, the national index decreased 0.12 percent in July to 100.68. With the one-month decline, the national index is just above the level set last July, up 0.04 percent year-over-year.

National Index Graph

Regional Employment

During the past 12 months, small business employment in the regions on the East Coast strengthened. Up 0.52 percent for the past three months, South Atlantic remained in the top spot with highest regional index and is up 0.80 percent year-over-year. Middle Atlantic was the only region with a stronger 12-month growth rate, 0.89 percent. Conversely, the pace of growth on the West Coast declined as the Pacific region slid 0.28 percent this July and 0.72 percent from previous July. Additionally, having fallen hard with oil prices, the West Central regions are the two lowest-ranked regional indexes and have the worst 12-month growth rates.

Regional Heatmap plus legend
Note: Percentages displayed in the regional heat map reflect 12-month changes.

State Employment

Washington remained the top-ranked state index at 103.63, but was unable to maintain the pace set in June, slipping 0.83 percent. Georgia surged in July with the strongest one-month gain to become the second state with an index above 103. Ranked 19th among states at the end of 2015, Virginia now ranks third, as the rate of small business employment increased dramatically in 2016. Following other economic indicators, Wisconsin has slowed in recent months. Despite a large gain in July, Illinois remains the lowest-ranked state at 99.48. After hitting a record high last month, New Jersey held steady in July, falling just 0.04 percent to 101.20. Up 2.17 percent from 2015, New Jersey has the second best 12-month growth rate among states.

State Chart
Note: Analysis is provided for the 20 largest states based on U.S. population. The chart's dark blue bars reflect the index level and the light blue diamonds reflect the 12-month change.

Metropolitan Employment

At the top of the metro ranking, Seattle and Atlanta mirror their state indexes, with Seattle slowing and Atlanta gaining significantly. Following a quick descent to begin 2016, Dallas has settled just below 103, third place among metros. Up 1.26 percent from last year, the Washington D.C. metro had its tenth straight month with an increase. Similarly, New York City had its ninth consecutive increase in July, as the NYC metro has the best 12-month growth rate, 2.00 percent. St. Louis had a strong month, but remains ranked last among metros with the weakest 12-month growth rate, -2.46 percent. The Boston metro is up 1.84 percent from last July and ten spots in the metro index rankings, moving from 19th to ninth.

Metro Chart
Note: Analysis is provided for the 20 largest metro areas based on U.S. population. The chart's dark blue bars reflect the index level and the light blue diamonds reflect the 12-month change.

Industry Employment

Employment growth slowed in eight of the nine industries in July, with Trade, Transportation and Utilities being the only industry sector to increase. Up 0.23 percent from the previous month, Trade, Transportation, and Utilities is back over 100 for the first time since July 2015. Construction had the worst one-month result, declining 0.53 percent, giving up all of its June gains. Nevertheless, at 101.67, the Construction index is only surpassed by Other Services. Education and Health Services had a small setback in July, but continues to trend positively year-over-year with an index just below 101. At 99.25, Financial Activities is at a four-year low and is having its worst start to a year since 2006. Financial Activities is down 0.52 percent in 2016 and 1.21 percent year-over-year. Below 99 and down for the sixth straight month, Manufacturing remained the lowest ranked industry at 98.44.

Industry Chart
Note: Analysis is provided for eight major industry sectors. The chart's dark blue bars reflect the index level and the light blue diamonds reflect the 12-month change.

For more information about the Paychex | IHS Small Business Jobs Index, visit the website. Plus, view and download the July 2016 Paychex | IHS Small Business Jobs Index infographic. Or, sign up to receive monthly alerts on the Paychex | IHS Small Business Jobs Index.

*Information regarding the professions included in the industry data can be found at the Bureau of Labor Statistics website.

*Information regarding the professions included in the industry data can be found at the Bureau of Labor Statistics website.

About the Paychex | IHS Small Business Jobs Index

The Paychex | IHS Small Business Jobs Index is released each month by Paychex, Inc., a leading provider of payroll, human resource, insurance, and benefits outsourcing solutions for small-to medium-sized businesses, and IHS Markit, a world leader in critical information, analytics and solutions, providing analysis of small business employment trends across the U.S.

The index analyzes same-store, year-over-year worker count changes to identify and track small business employment trends using real small business payroll data from the Paychex client base. The index is based on aggregated data from approximately 350,000 small businesses with fewer than 50 workers across the United States, one of the largest sample sizes of any small business index or report in the country, and provides timely, accurate insight into national, regional, state, metro, and industry employment activity.

About Paychex

Paychex, Inc. (NASDAQ: PAYX) is a leading provider of integrated human capital management solutions for payroll, HR, retirement, 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 45 years of industry expertise, Paychex serves approximately 605,000 payroll clients across more than 100 locations and pays one out of every 12 American private sector employees. Learn more about Paychex by visiting www.paychex.com, and stay connected on Twitter and LinkedIn.

About IHS Markit (www.ihsmarkit.com)

IHS Markit (Nasdaq: INFO) is a world leader in critical information, analytics and expertise 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 key business and government customers, including 85 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. All other company and product names may be trademarks of their respective owners © 2016 IHS Markit Ltd. All rights reserved.

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