In a little bit of an odd occurrence, small business employment for the month of June decreased while online lending continues to rise. “According to the Paychex | IHS Markit Small Business Employment Watch, the Small Business Index in June declined to 99.40, a 0.69 percent year-over-year decrease.” This means that both wages and hiring for small businesses were down reflecting economic health.
In addition, June “marks the 12th consecutive month of a Small Business Index mark of less than 100.”
“Despite the tightening labor market conditions, we’re seeing only modest levels of wage growth,” said Martin Mucci, Paychex president and CEO. “With the unemployment rate at historic lows, we’d expect to see accelerating wages in this type of employment market.”
With record highs in lending, one would expect wages to reflect theincrease in business cash flow, but this has not been the case. For online lending, between 2015 and 2017, “lending to small businesses by the five leading online lending providers increased 50 percent.” According to a report, the “nation’s largest FinTech small business lending platforms funded nearly $10 billion in online loans from 2015 to 2017, generating $37.7 billion in gross output, creating 358,911 jobs and $12.6 billion in wages in U.S. communities.”