After the better-than-expected February jobs report, the Fed has reiterated its intention to keep raising rates until 2023 to keep inflation in check.
US and Canadian data reflect a modest fall in core employment indicators in February, especially a sharp fall in wage inflation.
The US Federal Reserve (Fed) has renewed interest in near-term interest rate hike plans after February’s better-than-expected increase in non-farm payrolls. Similar to previous iterations of this report, Homebase has analyzed behavioral data from over 2 million employees working in over 100,000 SMBs, predicting that the broader economic environment will shift to small and medium enterprises in early 2023. and its employees.
Summary of Findings: Working hours and workforces decreased across most industries and metropolitan areas in February.
- Core metrics were relatively flat in the first two months of 2023compared to the same period last year, we do not see the monthly growth seen in the same period in 2022.
- Core metrics were relatively flat in the first two months of 2023compared to the same period last year, we do not see the monthly growth seen in the same period in 2022.
- Month-to-month fluctuations in economic performance across metropolitan areas are relatively small, Average MSA is declining across key employment indicators.
- Wage inflation is still positive, but Record low since October 2021.
February employment growth slowed compared to recent years
After a strong January, employment growth slowed significantly in February.Home-based data also showed a decline in overall employee work hours
working employees
(7-day average monthly change compared to January of the reported year)
open business
(7-day average monthly change compared to January of the reported year)
![Home-based business to open in February 2023](https://joinhomebase.com/wp-content/uploads/2023/03/Businesses-open.png)
Source: Headquarters data.
Most industries saw job declines, with hospitality and entertainment outliers
After a strong start to the year, major industries slumped in February. Entertainment, food and beverages and hospitality are still up compared to employment in December.
Employment indicators are Around 1% decrease in retail sectorhas seen a significant drop in recent weeks
Rate of change in working employees
(using baselines of mid-February and mid-January, January 1919 and January 23)1
![Home Base Percentage Change in Working Employee Feb 2, 2023](https://joinhomebase.com/wp-content/uploads/2023/03/Homebase-Percent-change-in-employees-working-2-Feb-2023.png)
1. Feb 17-23 vs Jan 13-19 (2019) and Feb 19-25 vs Jan 15-21 (2023). Notable dips usually coincide with major US holidays.Source: Headquarters data
Different regions performed differently in February, with weather and seasonality making some differences
![Things were different in the home region in February 2023](https://joinhomebase.com/wp-content/uploads/2023/03/Regions-fared-differently-in-February.png)
Note: February 19-25 and January 15-21.Source: Headquarters data
February wage inflation hits lowest level since 2021
wage inflation
Month-to-month change in average hourly wage
![Home Based Wage Inflation Feb 2023](https://joinhomebase.com/wp-content/uploads/2023/03/Wage-inflation.png)
Staff
pulse check
The February Pulse survey of about 800 employees showed a consistently positive outlook on employment prospects.
Employees believe their job prospects will improve in the coming year
Most employees surveyed believe their job prospects will improve (40%) or stay the same (35%) in one year, but only 6 believe they have worse options than they do now % is. This points to a slightly less negative outlook compared to mid-2022 and more uncertainty compared to the beginning of last year. With inflation being a top priority for many, we are confident that small business workers will continue to have a choice of where to work in the future.
Survey questionQ: Do you think your job options will be better, about the same, or worse in 12 months than they are today?
![Homebase February 2023 job choices will be better](https://joinhomebase.com/wp-content/uploads/2023/03/Will-job-options-be-better.png)
sauce: A pulse survey of home-based employees. N = 873 (February 2023)
About 25% of employees plan to look for a new job in the next few months
The majority of workers are generally happy with their jobs, but that doesn’t necessarily mean they plan to stay with their current employers long-term. Only 57% of workers surveyed do not plan to seek new opportunities in the next six months, even though 78% report being satisfied with their jobs. As the labor market heats up, small business employees know they have a choice.
That said, an October survey found that 48% of employees said they had no plans to look for a new job in the coming year, suggesting that economic concerns are increasing retention compared to the previous month.
![Homebase Satisfied with work February 2023](https://joinhomebase.com/wp-content/uploads/2023/03/Happy-with-my-job.png)
![Homebase February 2023 Looking for a job in 3-6 months](https://joinhomebase.com/wp-content/uploads/2023/03/Looking-for-a-job-in-the-next-3-6-months.png)
sauce: A pulse survey of home-based employees. N = 873 (February 2023)
Inflation is not only an issue for economists, it’s also the number one concern for workers
Of all the issues employees face both on and off the job, inflation was the only concern cited by the majority (64%) of those surveyed. Workers feel secure in their jobs and the time they have available, but worry about how far their wages will go in an inflationary environment.
![Top Homebase Employee Concerns February 2023](https://joinhomebase.com/wp-content/uploads/2023/03/Top-employee-concerns-2023.png)
sauce: A pulse survey of home-based employees. N = 873 (February 2023)
Even in the face of inflation, wages remain top priority for workers
Not surprisingly, wages are the number one factor in determining where respondents choose to work, with 54% citing wages as the top three factors in their hiring decisions. Benefits and employer-sponsored upskilling lag behind. This shows that employers need to invest in their workforce to attract and retain talent.
![Home Base Factors that will determine where to work in February 2023](https://joinhomebase.com/wp-content/uploads/2023/03/Factors-in-decision-on-where-you-work.png)
sauce: A pulse survey of home-based employees. N = 873 (February 2023)
For a PDF of the February report, see below. Please cite Homebase if you use this data for research or reporting purposes.
February 2023 Home Base Main Street Health Report