Employment growth for small business in the USA has fallen to the lowest level in years as smaller companies are challenged to attract and retain employees. Low unemployment and rising wages are creating hiring challenges for companies of all sizes.
According to a May 12, 2019 article in the Wall Street Journal:
Smaller businesses are having a tough time adding workers in today’s job market. Companies with fewer than 20 workers boosted head count by just 0.9% in April compared with a year earlier, according to Moody’s Analytics, which examined data from payroll processor ADP. That trails the 3.5% increase at businesses with 500 to 999 employees and the 1.8% gain at the largest companies. Roughly 17% of private-sector workers—or nearly 21 million Americans—work at companies with fewer than 20 employees, according to the most recent Bureau of Labor Statistics data.
Larger companies tend to pay more than small firms, and they are handing out bigger raises. Businesses with 500 to 999 employees boosted wages in the first quarter by an average of 5.3% from a year earlier, according to the Moody’s analysis. That compared with a 4.1% average pay increase at companies with fewer than 50 employees.
Small Business Can Level the Playing Field by Joining a Professional Employer Organization
As the competition for workers heats up, many small business owners and managers recognize that they need a cost-effective way to improve their ability to attract and retain employees. Companies that join a PEO gain the ability to offer a full suite of employee benefits to their workers without the internal overhead costs associated with obtaining and administering payroll, payroll taxes, workers’ compensation insurance, health insurance plans and supplemental insurance plans like dental, vision and disability insurance. While larger companies can offer those benefits to their workers, smaller companies may find they are outgunned in the battle for workers. Companies that join a PEO can even the playing field in the battle for workers and talent.
