10:58 AM EDT, 07/02/2024 (MT Newswires) -- Hiring by small businesses in the US decelerated in June on a monthly basis, while hourly earnings growth remained unchanged, data released Tuesday by Paychex ( PAYX ) showed.

The jobs index came in at 100.29 in June, versus 100.58 in May and 101.37 last year, according to the Paychex Small Business Employment Watch. An index value of over 100 shows job gains. The report is focused exclusively on businesses with fewer than 50 workers and offers analysis of national employment and wage trends.

Hourly earnings growth held steady at 3.16% in June, in line with the slowing trend seen during the first half of 2024, according to Paychex ( PAYX ). Weekly earnings growth of 2.96% improved for the third consecutive month, it said.

"Small businesses continued to add jobs across the country in June and there was little change in wage inflation, which reflects relative stability for small businesses," Paychex ( PAYX ) Chief Executive John Gibson said. "The trends in our wage data over the first half of 2024 are also signaling steady hourly earnings growth heading into the second half of the year."

Education and health services and professional and business services, the two largest industry sectors, increased their rate of small business employment growth sequentially last month.

"While jobs are growing nationally, small businesses in some geographies and industries continue to face a challenging operating environment due to complex regulations, a tight labor market, and inflationary pressures," according to Gibson. "We are continuing to see the impact of these challenges in the West region, particularly in the state of California."

In June, California dropped to the lowest position among states with a jobs index reading of 99.37, marking the third consecutive month below a 100 reading and signaling year-over-year job losses.

Leisure and hospitality was the weakest sector in terms of job gains in the state, seeing a 2.70 percentage-point decline over the last quarter, according to the report.

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