Payrolls at US small businesses grew by roughly 29,500 positions last month, according to the Gusto Small Business Jobs Report published September 1. The gain extends the hiring run to seven consecutive months, though it was the slowest month of that stretch.
For solo operators and microbusiness owners, the headline number matters less than the pattern underneath it. Employers are still adding people; they are just being pickier about who, and they are paying more than they did a year ago.
What The August Report Found
Thirteen of 19 sectors posted gains in August, and all four regions plus every company size tier finished the month in positive territory. Healthcare and social assistance led again with 16,300 net hires, ahead of construction at 4,200, administrative and support services at 2,100, and other services at 1,900.
Six sectors lost jobs on net, with hospitality at the bottom of the table. Mining, utilities, and transportation and warehousing all flipped from positive into negative during the month, joining agriculture and producing the narrowest breadth of the seven-month run.
Gains were spread fairly evenly by company size. Firms with 5 to 9 employees added 9,400 positions, those with 10 to 19 added 9,200, the 20 to 49 tier added 8,000, and the smallest firms with 1 to 4 employees added 2,900.
Why This Matters For Self-Employed Owners
The pay data is the part worth reading closely. Average hourly earnings across small business workers hit $37.31 in August, a 3.9% increase over the year, while starting pay for newly hired workers rose 3.2% to roughly $25.78 an hour.
That figure sets the market rate any solo owner has to beat the first time they hire help. It also tells freelancers what clients are paying internally, which is real leverage when pricing a retainer against the cost of an in-house alternative.
Nich Tremper, a senior economist at Gusto, framed the month as “a slowdown, not a pullback,” noting that every region and company size still added jobs. That distinction matters for anyone whose income depends on small business clients continuing to spend.
What Self-Employed Owners Should Do Next
If hiring is anywhere on your fall roadmap, price the role against regional wage growth rather than last year’s budget. Gusto put wage growth strongest in the West at about 5.1%, followed by the South near 4.0%, the Northeast at roughly 3.6%, and the Midwest at about 3.1%.
Contractors serving the sectors that slipped should stress test their pipeline now rather than in November. Hospitality, transportation and warehousing, and utilities all shed jobs on net in August, and vendors to those industries usually see invoices stretch out before they see outright cancellations.
It is also a reasonable moment to revisit rates. When employee pay climbs almost 4% in a year, and a freelancer’s rate card hasn’t moved, the gap quietly becomes a pay cut.
What To Watch Next
The federal August employment report arrives September 4 and will show whether this cooling is confined to smaller firms or shows up across the wider labor market. Gusto’s own revisions are worth tracking as well, since June was marked down to 35,800 net hires and July was revised up to 42,400 with this release.
For month-to-month context, compare the August figures against our earlier coverage of small business hiring in June. One soft month is noise, and three in a row would be something closer to a trend.
Photo by Annie Spratt: Unsplash
