Revenues Just Starting to Approach Pre-recession Levels;
Employment Growth Continues but Slowly
The newly-launched Intuit Small Business Revenue Index, which is based on anonymized, aggregated data from QuickBooks Online, is the first in the market to provide current information on monthly small business revenue. It complements Intuit's monthly Small Business Employment Index to provide a more complete picture of the economic health of the nation's small businesses based on revenue, hiring and compensation trends.
"There are many sources of information about the activity at big
companies, but very few on the activity at small businesses," said
The Revenue Index shows that small businesses were hard hit by the downturn, and are just starting to reach pre-recession revenue levels. Industry-level analysis shows that different sectors of small business were hit harder than others, and at different points in the recession.
Small businesses in the professional, scientific and technology fields fared the best through the downturn, and despite a big decline starting in late 2008, now have revenues that exceed pre-recessionary levels. Meanwhile, revenues for the real estate and construction industries began falling in 2007 and have seen little recovery. The health care and social assistance sector shows a mild decline in revenues over the past year.
Revenue Index by Industry
The changes in small business revenue by industry are consistent with many accounts of economic activity over the last seven years. Construction sector revenue stopped growing at the beginning of 2006, began a slow decline in mid 2007, and then a more dramatic decline starting in mid-2008.
Revenues for real estate services and leasing declined from mid-2005 to
early 2009 and have been flat since then. Revenues for professional
services grew until the fourth quarter of 2008, and then declined
abruptly around the time of the bank crisis in
The health care and social assistance sector also showed a small decline in revenues to businesses in this sector, but only recently, starting in 2011.
"In general, the health care and social assistance sector is much more
resistant to the business cycle than are the other industries," said
Small Business Employment Index
The monthly Small Business Employment Index, which is based on data from Intuit Online Payroll, shows that small business employment started growing in the fall of 2009 through 2011 and continues, albeit slowly, into 2012. In April there was a 0.2 percent increase in jobs for an annual growth rate of 2.5 percent. This equates to approximately 40,000 jobs created in April though Intuit plans to recalibrate the Index in the coming months and expects these numbers to change.
Based on April's numbers and revised national employment data from the
Decrease in Hours Worked, Increase in Compensation
Small business hourly employees worked an average of 107.3 hours in
April, a decrease of 0.14 percent, or around 8 minutes, from the revised
figure of 107.4 hours in March, making for a 24.8-hour workweek. Average
monthly pay for all small business employees increased to
Small Business Employment by Geography
The Intuit Index shows overall employment growth in all census divisions
|U.S. Census Division||Percent Change in Employment|
|East North Central||0.15%|
|West North Central||0.03%|
|East South Central||0.6%|
|West South Central||0.3%|
Small Business Employment by U.S. Census Division continues to grow in all parts of the country. The data reflects employment from 80,000 small business employers, a subset of small businesses that use Intuit Online Payroll. The month-to-month changes are seasonally-adjusted and informative about the overall economy.
|State||Percent Change in Employment|
Small Business Employment by State is up for most states in which Intuit Online Payroll has more than 1,000 small business firms represented. The month-to-month changes are seasonally adjusted and informative about the overall economy.
About The Intuit Small Business Indexes
The Intuit Small Business Indexes provide unique, near real-time
information each month on the activity of the smallest businesses in the
U.S. in terms of revenue, hiring and compensation trends. The new
Revenue Index, which covers the period from
Founded in 1983, Intuit had annual revenue of
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