WASHINGTON (Reuters) - Small businesses increased hours and compensation for employees in March by the most in more than two years, according to an independent survey on Thursday that offered further signs of improving labor market conditions.
The average monthly salary for small business employees rose 0.7 percent, or $18 per worker, according to Intuit, a payrolls processing firm. That was the largest percentage gain since December 2009.
However, that is equivalent to an annual salary of $33,400, meaning that many of the small business employees are working part-time.
“This is the strongest small business employment report we have had in a long time,” said Susan Woodward, the economist who worked with Intuit to develop the survey.
“However, we are not out of the woods yet. While the various indicators of this market are the strongest we’ve seen in a while, the rate of increase will not get us back to full employment any time soon.”
Average monthly hours worked by small business employees increased by 0.5 percent, or 36 minutes, making for a 25.8-hour workweek. The percentage change was also the largest since December 2009.
The sturdy gains came even as hiring by small businesses took a step back, with employers adding 65,000 workers to their payrolls in March, Intuit said.
However, February’s small business payrolls increase was revised up to 75,000 jobs from the previously reported 55,000.
The government’s more comprehensive employment report due on April 6 is expected to show nonfarm payrolls recorded their fourth consecutive month of increases above 200,000, according to a Reuters survey. The unemployment rate is seen steady at a three-year low of 8.3 percent.
The Intuit survey is based on responses from about 72,000 small businesses with fewer than 20 employees that use the Intuit Online Payroll system. It covered the period from February 24 to March 23.
Reporting by Lucia Mutikani; Editing by Jan Paschal