Small business employment saw its greatest gains in a year in the month of March.
Signalling continued recovery in the labor market, Reuters reported that employment in small businesses increased by 0.19 employees per firm last month as measured by the National Federation of Independent Businesses. March marked the fourth consecutive month of small business employment gains, and the highest rate since March 2012.
While small business employment growth could be a harbinger of the strength of the economy as a whole, other indicators tell a story of lower expectations for overall job growth. ADP’s National Payroll Report showed 158,000 jobs added in the private sector last month, a five-month low in new job growth. Additionally, Reuters’ survey of economists predicts the government will report this week that 200,000 new jobs were added to the economy in March, a decline from February’s 236,000 jobs. The unemployment rate is expected to remain at 7.7 percent.
Still, the increase in small business employment stands as a bellwether of continued economic recovery, even if modest in light of government austerity measures and January’s tax increase. Economists believe both factors will prove to be a drag on the economy, and will slow growth for the remainder of the year.
Reuters, “Small Business Employment Climbs by Most in a Year”. 4/3/13