Paychex’s January Small Business Employment Watch shows that job and wage growth among U.S. small businesses remained largely unchanged as the year began. The Small Business Jobs Index, reflecting payroll data for clients with fewer than 50 employees, ticked up 0.04 percentage points to 99.30 in January, while hourly earnings growth held at 2.68%, roughly the same pace since July 2025. Weekly earnings growth eased to 2.53%, and the one-month annualized weekly earnings growth sank to 1.62%, marking three consecutive months below two percent for the first time since December 2020. Regionally, the Midwest led job growth for the twentieth straight month, and Education and Health Services sustained its position as the fastest-growing sector for small businesses, reporting an index of 100.57 and nearly five years of continuous expansion.

In the third quarter, AE Wealth Management LLC increased its Paychex stake by 222.4%, acquiring an additional 8,385 shares to reach 12,156 shares valued at $1.54 million. Other institutional investors such as Brighton Jones LLC and Empirical Finance LLC also modestly raised their positions, contributing to a total institutional ownership of over 83%. In its most recent quarterly report, Paychex delivered $1.26 earnings per share, surpassing consensus by $0.03, and generated $1.56 billion in revenue, up 18.3% year-over-year. The company set full-year 2026 earnings guidance between $5.48 and $5.53 per share, while maintaining a quarterly dividend of $1.08 and authorizing a $1 billion share repurchase program representing up to 2.5% of outstanding shares. Paychex’s return on equity stands at 46.4% with a net margin of 26.5%, underscoring its cash-flow strength and commitment to shareholder returns.