Intuit Indexes: Small Business Employment Declined Since May; Revenues Fall for Seventh Consecutive Month

  Intuit Indexes: Small Business Employment Declined Since May; Revenues Fall
  for Seventh Consecutive Month

 New Methodology Provides Better Picture of Economy’s Effect on Entrepreneurs

Business Wire

MOUNTAIN VIEW, Calif. -- October 30, 2012

The latest edition of Intuit Inc.’s (Nasdaq: INTU) Small Business Revenue and
Employment Indexes shows an ongoing decline in small business employment since
May. Intuit has revised the Employment Index to provide a better measure of
employment for U.S. firms with fewer than 20 employees. Methodology for the
Revenue Index is based on a separate model and remains unchanged.

The October Employment Index indicates that small business employment
decreased by 0.05 percent, at an annualized decline of 0.6 percent, equating
to approximately 10,000 fewer jobs than in September. Based on October’s
numbers and the latest national employment data from the Bureau of Labor
Statistics (BLS), Intuit revised downward the previously reported September
employment rate to a decline of 0.06 percent, also a monthly decrease of
approximately 10,000 jobs.

The Intuit Small Business Employment Index model has added four main inputs to
the methodology and has been revised to align with the quarterly Business
Employment Dynamics data from BLS. The new inputs include an expanded set of
Intuit small business payroll customers and monthly BLS private payroll,
construction payroll and self-employment data. The BLS total payroll data used
in the previous model will continue to be a data input in the new model.
Detailed information on the new index methodology can be found at
index.intuit.com.

“The employment and revenue indexes have long been the only source of near
real-time employment and revenue data for the smallest of small businesses,”
said Susan Woodward, the economist who worked with Intuit to create the
indexes. “Now that Intuit has added new data inputs to its methodology and
more than doubled its anonymized sample size of payroll customers from
approximately 80,000 to 170,000, we’re in an even better place to report on
the growth of U.S. small businesses.”

Small Business Employment Index

The October decrease in employment continues a mild decline that began in May.
From March 2010 to May 2012, small business employment grew by 150,000 jobs,
totaling 19.9 million. Since May, small business employment has fallen by
65,000 jobs, bringing total recovery to 85,000 small business jobs.

“The absence of a strong rise in small business employment during the recovery
reflects two forces,” said Woodward. “First, while construction shows some
recovery, residential construction activity remains far below where it was in
2006. Second, small business employment has been a declining share of private
sector employment for at least 60 years. The decline tends to be abrupt in
recessions and slower the rest of the time. The jobs lost are primarily
non-manual routine work, such as word processing and checkout services in
retail. These jobs are also lost in larger firms, but small businesses start
with more of these jobs and thus lose more.”

October’s employment index is based on data from Intuit Online Payroll and
QuickBooks Online Payroll, and covers the period from Sept. 24 through Oct.
23.

Decrease in Hours Worked and Compensation

Small business hourly employees worked an average of 107.1 hours in October, a
decrease of 0.7 percent, or about 42 minutes, from the revised figure of 107.8
hours in September, making for a 24.7-hour workweek.

Average monthly pay for small business employees dropped to $2,791 in October,
or 0.1 percent, from the September revised figure of $2,794 per month. This
equates to a decrease of $3–down from the growth of $17 seen from August to
September. The equivalent annual wages would be about $33,500 per year, which
is part-time work for many small business employees.

Small Business Employment by Geography

The Employment Index showed mixed growth in the U.S. census divisions, with
decreases in all regions except the Pacific, Mountain and West South Central
divisions, which saw growth, and the West North Central region, which remained
flat. A state-by-state breakdown showed the largest employment increases in
Arizona, Indiana and Texas, while Oregon, Louisiana and Michigan saw the
largest decreases.

                     
U.S. Census Division  Percent Change in Employment
East North Central    - 0.03%
West North Central    0.0%
Middle Atlantic       - 0.04%
Mountain              + 0.04%
New England           - 0.06%
Pacific               + 0.01%
South Atlantic        - 0.02%
East South Central    - 0.02%
West South Central    + 0.05%

Small Business Employment by U.S. Census Division is mixed in most parts of
the country. The data reflects employment from approximately 170,000 small
business employers, a subset of small businesses that use Intuit Online
Payroll and QuickBooks Online Payroll. The month-to-month changes are
seasonally adjusted and informative about the overall economy.

               
State           Change in Employment (%)
Alabama         +0.08
Arizona         +0.13
California      +0.02
Colorado        +0.05
Connecticut     -0.08
Florida         0
Georgia         +0.01
Illinois        +0.01
Indiana         +0.11
Kansas          +0.03
Louisiana       -0.10
Maryland        +0.08
Massachusetts   -0.03
Michigan        -0.09
Minnesota       +0.02
Missouri        +0.05
Nevada          -0.01
New Jersey      -0.01
New York        -0.02
North Carolina  -0.08
Ohio            -0.05
Oklahoma        +0.08
Oregon          -0.11
Pennsylvania    +0.01
South Carolina  -0.04
Tennessee       -0.05
Texas           +0.11
Utah            +0.04
Virginia        -0.04
Washington      -0.01
Wisconsin       0

Small Business Employment increased for most states in which Intuit Online
Payroll and QuickBooks Online Payroll has more than 1,000 small business
firms. The month-to-month changes are seasonally adjusted and informative
about the overall economy.

Small Business Revenue Index

Small business revenue overall fell by 0.3 percent in September. Since
February 2012, small business revenues have declined by 2.5 percent, equating
to an annualized decline of 4.3 percent.

“The decline in small business revenue is consistent with the decline in small
business employment over roughly the same period,” said Woodward. “During the
recession, small business revenue fell a dramatic 13 percent, but then
recovered strongly. The rise in revenue from the lowest point in the recession
– April 2009 – to February 2012 was 15 percent, which surpassed even the
previous peak in revenue. Unfortunately, we’ve seen only a decline these past
seven months.”

                                                  
                                                   September Change in
Sector                                             Revenue (%)
All                                                -0.3
Construction                                       -0.8
Accommodation, food services, and drinking places  -0.5
Professional, scientific, and technical services   -0.5
Retail trade                                       -0.5
Health care and social assistance                  -0.2
Other services                                     -0.1
Real estate and rental and leasing                 -0.1

The Intuit Small Business Revenue Index is based on data from more than
100,000 small businesses, a subset of the total QuickBooks Online financial
management user base.

By industry, the September Revenue Index indicates that construction saw the
biggest decline, at 0.8 percent, followed by retail, professional services,
and accommodation and food services, each declining by 0.5 percent. The real
estate and health care industries saw the smallest declines, at 0.1 and 0.2
percent respectively. The health care sector has seen the biggest continual
decline, falling 6.5 percent since December 2011.

The index is based on data from QuickBooks Online and covers the period from
Sept. 1 -30.

About The Intuit Small Business Indexes

The Intuit Small Business Indexes provide unique, near real-time information
each month on the activity of the smallest businesses in the U.S. in terms of
revenue, hiring and compensation trends. The Employment Index is based on
anonymized, aggregated data from 170,000 small business employers, a subset of
users that use Intuit Online Payroll and QuickBooks Online Payroll. The
Revenue Index is based on anonymized, aggregated data from approximately
100,000 small businesses, a subset of users that use Intuit’s QuickBooks
Online  financial management offering and are matched in Dun & Bradstreet’s
small business industry classifications. Together, the indexes provide a more
complete picture of the economic health of the nation’s small businesses. More
information on the Intuit Small Business Indexes is available at
index.intuit.com.

About Intuit Inc.

Intuit Inc.  is a leading provider of business and financial management
solutions for small and mid-sized businesses; financial institutions,
including banks and credit unions; consumers and accounting professionals. Its
flagship products and services, including QuickBooks®, Quicken® and TurboTax®,
simplify small business management and payroll processing, personal finance,
and tax preparation and filing. ProSeries® and Lacerte®  are Intuit's leading
tax preparation offerings for professional accountants. Intuit Financial
Services helps banks and credit unions grow by providing on-demand solutions
and services that make it easier for consumers and businesses to manage their
money.

Founded in 1983, Intuit had annual revenue of $4.15 billion in its fiscal year
2012. The company has approximately 8,000 employees with major offices in the
United States, Canada, the United Kingdom, India and other locations. More
information can be found at www.intuit.com.

Intuit and the Intuit logo, among others, are registered trademarks and/or
registered service marks of Intuit Inc. in the United States and other
countries. Intuit Small Business Payroll Index is copyrighted by Intuit. Its
contents may not be resold or modified in any way. It can be linked to and
referenced with the following attribution: “Intuit Small Business Employment
Index © Intuit Inc. All rights reserved.” These Terms of Use supplement the
Small BusinessWebsite Terms of Service at:
http://smallbusiness.intuit.com/small-business/legal/index.jsp?_requestid=178246.

Contact:

Intuit Inc.
Tammy Lam
650-944-3807
tammy_lam@intuit.com
or
Access Communications
Vanessa Piccinini
415-844-6296
vpiccinini@accesspr.com
 
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