US Small Business Job Growth Moderated in June; Healthcare Sector Remained Top Hirer

Small businesses in the United States added 32,900 jobs in June, marking the fifth consecutive month of positive hiring but representing a significant slowdown from the pace set earlier in the spring. The Health Care and Social Assistance sector once again led the expansion, according to the June 2026 Small Business Jobs Report released by payroll and benefits firm Gusto.

The net hiring figure for June fell below the 12-month average of 45,900 new jobs. It follows a period of more robust growth, including a revised gain of 60,500 jobs in May and 76,500 in March. The initial report for May had shown a gain of 83,900 jobs before being revised downward. According to Gusto's data, small businesses made 2.53 million hires in June against 2.50 million terminations.

The Health Care and Social Assistance sector was the primary driver of job creation, adding 14,300 net hires. While this figure secured the sector's top position, it was a decrease from the 17,300 jobs it added in May, mirroring the broader cooling trend. This sustained growth in healthcare aligns with data from the U.S. Bureau of Labor Statistics, which also reported an upward trend in overall healthcare employment for June, though at a slower pace than its 12-month average.

Other sectors posting significant gains included Construction, which added 6,100 jobs, marking its fifth straight month as a top-performing industry for small business hiring. Professional, Scientific, and Technical Services also contributed positively, with a net gain of 3,800 positions. In total, 14 of the 19 sectors tracked by Gusto posted positive net hires for the month.

However, the moderation in the headline number was driven by notable reversals in other industries. The Accommodation and Food Services sector, a key component of the hospitality industry, experienced a significant swing, moving from a gain of 5,500 jobs in May to a net loss of 1,500 jobs in June. This reversal was a primary factor in the overall slowdown. In total, five sectors recorded net job losses during the month.

Despite the slower pace, the report indicated that the expansion was broad-based. All four major U.S. regions continued to add jobs, with the South leading at 10,900 net hires. Furthermore, every company size tier tracked in the report remained in positive hiring territory, suggesting that the underlying foundation of the small business labor market remains solid, even as the rate of expansion cools.

"June was a step back from the spring pace, but we've now seen five straight months of positive small business job growth," said Nich Tremper, Senior Economist at Gusto, in a statement accompanying the report. "All four regions added jobs, every company size tier stayed positive, and health care continued its run at the top. Small businesses continued their nearly half-year expansion through hiring in June."

The findings from Gusto's small business-focused report are consistent with broader labor market data. A separate report from payroll processor ADP also highlighted healthcare-related sectors as a key source of private-sector employment growth in June, while noting a general slowdown in the overall market. Similarly, the Bureau of Labor Statistics' national report showed continued job gains in social assistance and professional and business services, though leisure and hospitality employment declined on a national level.

This mixed environment, with some sectors powering ahead while others pull back, creates a complex landscape for business owners. The sustained hiring in areas like healthcare and construction, even as the broader economy moderates, places unique pressures on businesses to manage growth effectively. In our experience, rapid expansion, especially in labor-intensive fields, can expose significant operational and financial weaknesses if not properly planned. Companies often find that their existing back-office processes, from payroll to cash flow management, cannot keep pace with a growing headcount, leading to inefficiencies and financial strain. A proactive approach to financial strategy is essential to ensure that growth is sustainable and profitable.

This is precisely where strategic guidance becomes invaluable. For companies navigating this phase, an outsourced CFO service provides the high-level financial oversight needed to scale responsibly without incurring the full-time expense of a chief financial officer. This allows business owners to focus on their core operations while ensuring their financial infrastructure is robust enough to support their ambitions. To understand how to build a financial framework for sustainable growth, business owners can contact C&S Finance Group LLC at csfinancegroup.com.

Looking ahead, economists and business owners will be closely watching employment data for July to determine whether June’s moderation is a temporary adjustment or the beginning of a more sustained cooling trend. The performance of bellwether sectors like hospitality and healthcare will be a key indicator of the small business economy's trajectory through the second half of the year.