NEW! CalculatedRisk Newsletter on Real Estate (Ad Free) Read it here.

Friday, July 09, 2010

Small Businesses still reluctant to hire

by Calculated Risk on 7/09/2010 09:02:00 AM

From Sharon Bernstein at the LA Times: Jobs outlook for small businesses may be getting bleaker

Intuit Inc., which provides payroll services for small employers, says the nation's tiniest companies had fewer new hires last month than any time since October.
...
To calculate its estimate of national hiring, Intuit uses payroll information from its 56,000 small-business customers. The company defines small businesses as those with fewer than 20 employees.

Intuit's data show that small businesses hired just 18,000 additional workers last month. That's still positive territory, but it's less than a third of the 60,000 that were added in February, when it seemed that an employment recovery was imminent. Additional hiring dropped steadily during the spring, to 40,000 in April and 32,000 in May. Another payroll company, Automatic Data Processing Inc., painted an even gloomier picture, saying that small businesses lost 1,000 jobs nationwide in June.
According to surveys by the National Federation of Independent Business (NFIB), the problem isn't lack of financing or government regulation - the problem is a "shortage of customers".

NFIB chief economist Bill Dunkelberg recently said: “What small businesses need are customers, giving them a reason to hire and make capital expenditures and borrow to support those activities.”