Small Businesses Add 83,900 Jobs: May 2026 Gusto Small Business Jobs Report

May was another strong month for small business job growth, with America’s small businesses adding an estimated +83,900 net new jobs on a seasonally adjusted basis. May’s gain marks the fourth consecutive month of positive net hiring following January’s dip, extending the strongest four-month stretch of small business job creation since last summer.

The breadth of May’s gains was exceptional. Health care and social assistance led all sectors with +20,200 net hires, followed by accommodation and food services (+14,400) and administrative and support services (+8,700). A remarkable 17 out of 19 sectors posted positive net hires. All four U.S. regions added jobs, with the South leading at +36,200 net hires. And every company size tier was in positive territory – a level of consistency across industries, regions, and company sizes that points to a small business labor market with real momentum heading into summer.

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The Big Picture

At +83,900, May’s seasonally adjusted net hires comfortably exceed the 12-month average of +54,100. Here’s how the month compares to the recent trend:

• January 2026: –62,000 net hires

• February 2026: +82,600 net hires

• March 2026: +76,500 net hires

• April 2026: +54,900 net hires

Sector Breakdown

May’s sector gains were led by healthcare and hospitality:

• Health Care and Social Assistance: +20,200 net hires

• Accommodation and Food Services: +14,400 net hires

• Administrative and Support Services: +8,700 net hires

• Retail Trade: +8,400 net hires

• Construction: +8,000 net hires

• Other Services: +5,100 net hires

• Professional, Scientific, and Technical Services: +3,300 net hires

• Manufacturing: +2,400 net hires

• Transportation & Warehousing: +2,200 net hires

• Real Estate, Rental & Leasing: +2,200 net hires

Health Care and Social Assistance led all sectors for the month with +20,200 net hires, continuing a streak of outsized gains that has accelerated from +16,900 in April. Accommodation and Food Services posted a strong +14,400 as summer staffing ramps up, while Construction added +8,000 — its fourth consecutive month among the top five sectors

Only two sectors posted job losses – management of companies (–400) and utilities (–200). With 17 of 19 sectors in positive territory, the breadth of gains was one of the strongest cross-sector readings of 2026, coming close to March’s 18-of-19 showing.

Regional Breakdown

All four U.S. regions posted positive net hires in May:

• South: +36,200 net hires

• Northeast: +22,400 net hires

• West: +13,000 net hires

• Midwest: +12,300 net hires

The South held its position atop all regions for another month in May, continuing what has become a sustained run of labor market strength. The Northeast maintained second place, while the West rebounded from a weak April to reclaim third. 

Company Size Breakdown

All four company size tiers posted positive net hires in May:

• 20–49 employees: +36,400 net hires

• 5–9 employees: +20,100 net hires

• 10–19 employees: +18,600 net hires

• 1–4 employees: +8,800 net hires

Larger small businesses continue to carry the bulk of net hiring, but May's real story was momentum spreading into the middle tiers. Firms in the 10–19 and 5–9 employee ranges both accelerated sharply, and even the smallest businesses have now strung together several consecutive months of positive hiring — a sign that confidence in this segment has meaningfully broadened.

Takeaways for Small Businesses

Four consecutive months of broad-based job gains – the strongest sustained stretch since last summer – point to a small business labor market on solid footing heading into peak summer hiring season.

Looking ahead, the acceleration in hospitality, the durability of health care gains, and the broad participation across company sizes and regions all point to continued momentum.

Methodology

The Gusto Small Business Jobs Report tracks anonymized payroll data from a stratified random sample of roughly 100,000 small businesses across the United States with 1–49 employees, drawn from the 400,000+ companies on Gusto. All figures in this report are seasonally adjusted unless otherwise noted.

To ensure the findings represent small businesses across the United States, Gusto uses a two-stage weighting process. First, we randomly select a representative sample of companies (roughly 100,000 businesses annually) that match the national distribution of small businesses by industry, company size, and geographic region, using U.S. Bureau of Labor Statistics “Quarterly Census of Employment and Wages” data as a benchmark. Second, we adjust the sample to reflect the national distribution of company ages based on data from the Census Bureau’s “Business Dynamics Statistics.”

This report provides three key metrics for small businesses each month: Hires (new employees starting work), terminations (employees leaving for any reason), and net hires (the difference between hires and terminations, showing whether small businesses are creating or losing jobs overall). All data are seasonally adjusted using the U.S. Census Bureau’s X-13ARIMA-SEATS methodology.