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Job growth among U.S. small businesses with fewer than 50 employees is holding steady, according to the Paychex Small Business Employment Watch for July.

The national Small Business Jobs Index, a primary component of the report that measures the pace of small business job growth across the country, has increased 0.17 percentage points to 99.82 in July. The jobs index is scaled to 100, which represents no year-over-year change in job growth.

Meanwhile, hourly earnings growth for small business workers has maintained a consistent trend, remaining below three percent (2.74%) for the ninth consecutive month.

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“Our latest employment data points to a small business labor market that has remained consistent, including wages continuing below three percent, while workers have begun to see an increase in hours worked in July for the first time since August 2024,” said John Gibson, Paychex president and CEO. “We enter the back half of 2025 in a very similar position as we started, which speaks to the resiliency of small businesses given the amount of uncertainty they faced so far this year.”

Additional data shows:

The national Small Business Jobs Index in July (99.82) matches the 2025 year-to-date index level, showing modest month-to-month movement and signaling a consistent trend of stability for U.S. small businesses.

Hourly earnings growth has continued to trend below three percent for 11 of the last 12 months, marking a return to the historical average seen from 2014-2020.

Since hitting a six-year low in January 2025 (2.27%), weekly earnings growth among U.S. small business workers has steadily increased during the past six months to 2.76% in July.

Weekly hours worked have shown positive growth in July (0.11%) for the first month since August 2024, and the one month annualized weekly hours worked jumped to 2.31% in July.

Education and Health Services leads sectors for small business job growth for the 14th-straight month, and

Leisure and Hospitality remains last among sectors for job growth (98.35) in July, but its jobs index represents the largest one-month gain (0.59 percentage points) among industries.

The monthly report offers analysis of national employment and wage trends and examines regional, state, metro and industry sector activity.

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