Intuit has released its latest QuickBooks Quarterly Small Business Index for the 4th Quarter of 2024.
The Index, which looks at US small businesses with 1-9 employees, shows a loss of 16,800 jobs in the 4th Quarter, marking a -0.13% drop. Real revenue also fell by $6,300 per business over the same period, showing a -4.06% quarterly decline - the fastest decline since 4th Quarter of 2019.
With employment and revenue declining across most sectors and regions, the data signals a potential economic slowdown that could impact local economies, consumer spending, and the broader job market.
Here are some additional Index takeaways you may find useful for your practices and your clients' businesses.
Small businesses are losing jobs to larger companies: The leisure and hospitality sector saw the biggest small business job losses, while overall industry employment increased by 87,000 jobs - indicating that jobs are moving to larger businesses.
The majority of sectors showed negative job growth with a few exceptions: Of all 12 sectors, the utilities sector had the largest increase in employment with a 17.42% quarterly growth rate (its fastest growth since 2015) - but also experienced the steepest revenue decline (-$20,090 per business).
Regional employment shifts: The Mideast and Far West lost 6,000 small business jobs each, while New England and the Great Lakes saw four straight quarters of job growth.
Financing challenges hurting small businesses: Persistent inflation and high borrowing costs have contributed to falling revenues and slower hiring. The recent Small Business Index Annual Report showed that higher interest rates have suppressed small business revenue growth by up to 30% and employment growth by up to 4%.
These findings speak toward the pressures on small business. You can find out more about the index results, conclusions and potential impacts in the Intuit QuickBooks Quarterly Small Business Index for Q4 of 2024.