Follow us on

Friday, May 24, 2013 | 11:13 p.m.

Web Search by YAHOO!

Updated: 11:42 p.m. Thursday, April 12, 2012 | Posted: 10:22 p.m. Thursday, April 12, 2012

Jobs at small firms highest since 2009

Some warn that Ohio’s growth is too soft to impact jobless rate.

Related

Jobs at small firms highest since 2009 photo
Allen Adkins, a graduate of a Montgomery County on-the-job training program, is a full-time worker at Precision Gage & Tool in West Carrollton. Staff Photo by Jim Witmer

By Cornelius Frolik

Staff Writer

Small business employment is the highest it has been since January 2009, according to a new study, giving more evidence that a recovery is under way.

But while Ohio joined the trend by adding more workers last month, some business groups say the state’s economy is adding too few of these jobs to make any meaningful difference in the unemployment rate.

“I think it would be very premature to declare victory and say that we’ve come through all of the economic challenges of the last three years and the economy is getting ready to roar back,” said Roger Geiger, executive director of the Ohio chapter of the National Federal of Independent Business.

More than four in 10 private-sector workers in the Miami Valley work for firms with fewer than 50 employees, and employees at small businesses like these are working more hours, earning slightly higher wages and more of them are working full-time, according to state data and payroll studies.

Private-sector U.S. businesses with fewer than 50 employees added 100,000 new workers last month.

The new jobs bring overall employment among these businesses to 49.6 million, according to seasonally adjusted payroll data released this month by ADP, a New Jersey firm.

Although these small businesses created 13,000 fewer jobs last month than in February, there was still a net gain and the number of jobs created was up 9.9 percent from March 2011, according to ADP.

Small businesses added 548,000 new jobs between November and March, which was a major improvement from the five previous months when they added only 303,000 new jobs, according to the data.

Employment by establishments of this size last month was the highest it has been in more than three years. In March, employment by Ohio businesses with fewer than 20 employees grew slightly after declining in February, according to Intuit Inc. Across the country, businesses of this size added more than 65,000 jobs in March, and the monthly hours worked by employees increased by 0.5 percent. Monthly compensation increased by 0.7 percent.

Employment tends to be a lagging indicator of economic growth, but small businesses typically hire sooner than larger ones because it is harder for them to grow without adding to their payrolls, said Joel Prakken, the senior managing director of Macroeconomic Advisers, which helps sort the data for ADP.

“Coming out of a recession, employment at small establishments usually leads the way out,” he said.

Prakken said the job growth is encouraging but insufficient, because the economy needs to create millions of jobs in the next several years to return to full employment.

“We really need to kick this up into another gear,” he said.

Vicki Waltz, president of Precision Gage & Tool Co. in West Carrollton, said she has hired about nine new workers in the last 18 months, and she expects to hire two more in coming months.

The company currently employs around 25 people, and Waltz said she will only add to her payroll when she is confident that the investment in training new workers will pay off in the long term.

“The last thing I want to do is hire someone on, invest a lot of time and money in training them, and then not have work for them and have to lay them off,” she said, adding that her company’s orders continue to rise.

But some groups claim the environment for small businesses has stopped improving.

After six months of gains, optimism among small U.S. businesses fell in March, and fewer small business plan to hire and invest in their companies, according to a survey by the National Federation of Independent Business.

Geiger, with the Ohio chapter of the federation, said the minor uptick in hiring has not changed the fact that consumers are spending less than they did before the recession, and businesses continue to be mired in economic uncertainty over weak consumer demand and potential government regulations.

“We have seen some modest hiring growth,” he said. “But I think it would be really early to suggest we’re on the road to a quick and massive recovery.”

Contact this reporter at (937) 225-0749 or cfrolik@DaytonDailyNews.com.

More News

 

Hot topics

 

© 2013 Cox Media Group. By using this website, you accept the terms of our Visitor Agreement and Privacy Policy, and understand your options regarding Ad ChoicesAdChoices.