On a day in which the U.S. jobs report for April fell well short of expectations, the new CBIZ Small Business Employment Index showed a big gain.
The index, produced by Independence-based business services firm CBIZ Inc. (NYSE: CBZ), rose a seasonally adjusted 3.57% in April. The company said in a news release issued Friday, May 7, that the “remarkable gain in the reading highlights the quickened pace of hiring efforts as small businesses engage in increased economic activity.” CBIZ’s report coincided with data from the U.S. Bureau of Labor Statistics that showed the economy overall added 266,000 jobs last month — a good number under normal circumstances, but quite a bit lower than economists had been expecting as the economy recovers from the pandemic.
CBIZ’s index tracks payroll and hiring trends for more than 3,500 companies that each have 300 or fewer employees.
“While small business hiring increased in February and March, the momentum accelerated noticeably in April, with the (index) recording its largest seasonally adjusted spike,” said Philip Noftsinger, executive vice president of CBIZ, in a statement.
He added, “This growth period could have legs, but we expect it to begin to slow once the U.S. is fully reopened. We also anticipate potential volatility when the reading factors in the May 2020 dropoff, as the seasonality weighting now includes periods of closure from COVID-19.”
Here are some of the key findings of the April report, according to CBIZ:
• 26% of companies in the index added staff, while 19% reduced hiring, and 55% left headcounts unchanged.
• The Northeast (5.94%) had the strongest hiring growth, followed by the West (3.97%), Central (3.3%) and Southeast (2.5%) regions.
• Arts and entertainment accounted for the most growth, as live events began to restart around the country. That category was followed by agriculture, accommodations/food services, transportation and construction. Industries with hiring decreases included real estate and utilities.