Yesterday, in announcing the federal government's efforts to increase lending to small business, President Obama touted the resilient nature of small business owners. And there is some data that suggests that there was an uptick in hiring among small businesses last month. Take a look at this graph of the monthly Hiring Activity Index (HAI) figures since the start of 2008:
That graph is from Andrew Gelman, professor of statistics and political science at Columbia. He reworked data from an interesting analysis post by Josh Millet, CEO of Criteria Corp., an employee assessment firm. Criteria started tracking the hiring activity last year, and Millet says the 8 point jump is the highest they have seen.
It is only one data point, to be sure, but it suggests that for SMBs the hiring picture improved somewhat in February. Could it be an upwards blip in a downward trend? Of course, but the eight point jump in the HAI is the biggest we've seen since we started tracking the index. For those, like me, inclined to think that the current recession, although brutal and severe, will not be as long-lasting as some suppose, the February HAI reading is cause for hope. I don't expect that January's 7.6% figure for the overall unemployment rate is the end of it--we'll almost certainly see it get north of 8% soon. But as big public companies in the worst hit industries (financial services, construction, etc) continue to shed jobs the February HAI reading offers a glimmer of hope for the job market. Small and medium-sized businesses did not lead us into this recession, but they may just lead us out of it--and don't look now, but it may have already started.
You can read Millet's full post here.
And Gelman's reading of it here.
03-17-2009 8:38 AM