According to two of the top small business index reports, the month of October continued a string of strong reports for entrepreneurs. Both the ADP Small Business Report and the Paychex | IHS Markit Small Business Employment Watch showed a bit of a bump in small business hiring compared to the month of September.
ADP “reported 227,000 new private-sector jobs in October”, up from an initial estimate of around 178,000 from Econoday and above the revised 218,000 number for September. “Large businesses, meaning those with about 500 employees or more, led the way, as they added 102,000 jobs. Mid-sized enterprises (50-499 employees) added 96,000 positions, while small employers, or those with one to 49 workers, tacked on 29,000 jobs.”
When considering growth in sectors, trade, transportation and utilities category led the way along with leisure and hospitality accounting for about 100,000 of the new hirings.
According to Marketwatch, Economists are expecting a 3.7% unemployment report.
Paychex took a slightly different approach comparing information on a year to date scale. Still, an increase was made with small business owners raising hourly wages a moderate amount in October, despite a slowdown in job growth compared to last year. “The rate of hourly earnings growth in October was 2.41 percent ($0.63), the second consecutive monthly increase.”
Similar to ADP, the top sectors in hourly pay growth included trade, transportation and utilities as well as leisure and hospitality, and construction.
From a location standpoint, employment growth was largest in the South with wage growth being the largest in the West.
According to Paychex president and CEO Martin Mucci, “The sole proprietors, partnerships and S corps can deduct 20 percent of their qualified business income under some circumstances and write off the cost of their depreciable assets in the first year they are placed in service. Accountants should pay attention to the details of tax reform and that employees have the proper withholdings. Most employees don’t have the right amount of withholdings.”