#United States #San Francisco #Small Business #Jobs #Gusto

Gusto's Small Business Jobs and Pay Report: A Notable Octobers' Job Growth

According to the latest report from Gusto, small businesses in the United States experienced significant growth in October 2026, adding an estimated 38,000 net new jobs on a seasonally adjusted basis. This development marks the ninth consecutive month of positive hiring trends, showcasing a resilient small business economy.

Hiring Trends

The findings indicate that hiring activity has accelerated for the second month in a row, outpacing the 12-month average of 34,000. This uptick in job creation highlights a recovery from previous months' slower hiring rates, with September's figures revised down to 27,000 from an initial estimate of 28,000.

Of the 19 sectors analyzed, 16 reported positive hiring trends, with notable contributions from Health Care and Social Assistance, which alone accounted for 13,000 new positions. Professional, Scientific, and Technical Services followed with an addition of 5,500 jobs, while the construction sector contributed 3,800 positions. This broad-based hiring across various sectors and regions inspires optimism for the overall economic landscape.

Wage Growth

Compensation trends also reflect positive changes, as the average hourly earnings for small business employees increased by 3.9% year-over-year, now standing at $37.50. Moreover, the starting pay for newly hired workers saw an increase of 3.0%, reaching approximately $25.90 per hour. Nich Tremper, a Senior Economist at Gusto, noted that while the growth in hiring is promising, it still falls short of the brisk hiring pace observed in the earlier part of the year.

Job Growth Metrics

The report presents an encouraging snapshot of the job market:

• - Health Care and Social Assistance: +13,000 net hires
• - Professional, Scientific, and Technical Services: +5,500 net hires
• - Construction: +3,800 net hires
• - Other Services: +2,600 net hires

Only three sectors reported job losses, specifically Mining, Accommodation and Food Services, and Management of Companies, which collectively experienced reductions of fewer than 300 jobs each.

Regional Job Growth

On a regional basis, all four U.S. regions recorded positive net hiring in October:

• - South: +13,000 net hires
• - Midwest: +9,400 net hires
• - Northeast: +8,200 net hires
• - West: +7,000 net hires

The South led for the ninth consecutive month, while the West demonstrated the highest wage growth year-over-year at 5.0%. Notably, it also boasts the highest average hourly earnings among all regions, standing at $42.00. In comparison, the South grew at the national average rate of 3.9%, while the Midwest lagged slightly behind at 3.2%.

Company Size Dynamics

Hiring trends were also consistent across various company sizes:

• - 20-49 employees: +15,000 net hires
• - 5-9 employees: +12,000 net hires
• - 10-19 employees: +7,900 net hires
• - 1-4 employees: +3,600 net hires

These results indicate healthy hiring across different company sizes, with businesses having 20-49 employees leading the way. The persistence of job growth across varied sectors and business sizes suggests a robust small business economy.

Analysis and Methodology

The Gusto Small Business Jobs and Pay Report utilizes anonymized payroll data from a stratified random sample of approximately 100,000 small businesses with between 1 to 49 employees. This data is meticulously adjusted to reflect the national distribution of small businesses by industry, size, and region, aligning with the U.S. Bureau of Labor Statistics’ standards for accuracy. The report serves as a critical barometer for understanding employment trends within the small business sector and provides insight into the broader economic climate.

Conclusion

In summary, the October job creation figures from Gusto reflect a robust and resilient small business sector in the United States. As hiring continues to rise across various sectors and regions, accompanied by increasing wages, the outlook for small businesses remains promising as we head further into 2026.

For small business owners seeking resources to manage payroll, benefits, and compliance, Gusto remains a top partner, committed to supporting the growth and development of small businesses across the nation.