A new survey has found that small business owners are taking a more guarded management approach to hiring, which can be seen in the decline in new hires and an increases in current compensation rate maintenance according to Insperity, Inc.’s just released Business Confidence Survey. The trend is seen as another in small business’ creative ways of handling business in the new economy.
“Survey responses indicate that business owners are returning to more cautious management strategies to safely execute their short-term and long-term business plans,” said Paul J. Sarvadi, Insperity chairman and chief executive officer (CEO). “Regardless of industry, businesses continue to balance the current challenging risk-reward ratio in creative ways to serve clients and grow profits.”
The third-quarter 2013 survey involved 5,500 businesses whose business owners provided plans for the rest of the year. Questions covered issues that involve everything from hiring to health care reform.
- New Hires: When asked if they were hiring new employees, 28 percent of the small business respondents—2 percent more than the same time last year—said they would; 68 percent said they were staying the same (versus 63 percent in 2012); and 5 percent said they would be laying staff off, a drop from 2012’s 9 percent of then-anticipated lay-offs.
- Pay Rates: When asked about staff pay rates, 71 percent of small business owners responded that they do plan on paying staff at their current rate, while 17 percent are planned on increasing pay; 1 percent planned to cut staff pay and 11 percent said they are still not sure.
- Salary Changes: When discussing their plans for 2013’s third-quarter salary changes, 2.9 percent of small business owner respondents said their employee pay is up; however, bonuses are down 11.7 percent. Commission accounted for a 4 percent increase and 9.7 percent of employees’ regular pay was comprised of overtime.
- Economic Recovery: While 48 percent of business owners said they were unsure of their understanding of the economic recovery, 26 percent of the respondents believe we are in an economic recovery, while 26 percent expect recovery in the first quarter, or later, next year.
- Business Concerns: As of third quarter 2013, 67 percent—50 percent more when compared to July 2013—of respondents see the economy as their largest short-term concern. Health care reform ranked second at 55 percent. Going forward, 64 percent of business say they are most concerned with the federal deficit and the national debt, 63 percent say it is the economy with which they are most concerned, and 60 percent say government expansion is their greatest worry.
- Performance Targets: Businesses—a whopping 68 percent—say that they have hit their performance targets this year and 82 percent expect their sales to either increase or stay the same. Just 18 percent say that they either expect their sales to drop or are unsure if their businesses will increase or decrease.
- Driving Business: When asked in what ways respondents intend on driving business, 68 percent said by selling new accounts, 62 percent said by increasing client service, 46 percent said by adding new services or products, and 28 percent said they will drive business by investing in improvements.
Insperity conducted this survey from October 8th through 10th with CEOs, chief financial officers, and other executives in an array of businesses from its base of some 5,500 Workforce Optimization clients nationwide. The overall sampling error of the national survey is +/- 4.5 percent at the 95 percent confidence level, Insperity indicated.
Wicked Local Waltham; Small Business Owners Becoming More Guarded Again, Survey Says; December 2, 2013.
Insperity Inc.; Insperity Business Confidence Survey: Q3 2013 [Infographic]; Insperity Staff; November 1, 2013.