Paychex CEO says small business growth is improving as optimism translates to jobs

Executive Edge: Job growth continues 3-month streak

Small businesses across the country saw optimism and job growth continue to rise in February, hitting highs for a third month in a row as election hopes began to turn into jobs, Paychex president and CEO Marty Mucci said Tuesday.

"I think we saw a lot of optimism but less job growth the first month or so since the election," Mucci told CNBC's "Squawk Box." "Now it's starting to translate into actual job growth."

Mucci attributed the growth to President Donald Trump's pro-business agenda, which the president says will include tax reform. The Paychex CEO also nodded to the new version of the Affordable Care Act Trump revealed Monday as being positive for business.

Released on Tuesday, the Paychex report showed the Paychex/IHS Small Business Jobs Index rising to 100.78, up 0.16 percent from January and up 0.39 percent for the quarter, which started in December.

The report said that the 100.78 index number signals positive employment growth that is slightly speedier than last year's pace. The rate of growth has increased each month since December.

The East South Central region of the country remained the lead region for small business growth, with its February index at 103.41, growing at a year-over-year rate of 1.83 percent. Tennessee was once again the top-ranked state for growth.

"You see Nashville's got good high-tech jobs coming in there," Mucci said, adding that "e-commerce is now 15 percent of sales, and FedEx being based there, you're seeing a lot of shipping really pick up in the market, as well."

FedEx is headquartered in Memphis, Tennessee.

Neighboring West South Central region saw the biggest year-over-year decline, decreasing 1.51 percent from February 2016.

The South Atlantic region saw its strongest one-month rise in over four years, as Atlanta topped the metropolitan employment charts for the third month in a row.

The financial activities industry saw a 0.53 percent jump in February, the best one-month gain among the various sectors. Construction was the only industry to decline last month, despite being one of the South's top industries.