According to the August SurePayroll Small Business Scorecard, micro-businesses (those with between one and 10 employees) saw a month-over-month increase of .1%. While the increase is seemingly small, SurePayroll, a provider of payroll services to small businesses, says the change is significant considering that the organization’s Scorecard survey has reported small business hiring as flat to down month-over-month for the past year. And while year-over-year hiring is down 0.7% nationwide, optimism among small business owners is high, though, at 70%; by comparison, optimism was only at 54% in August of 2010.
“It’s not a trend yet, but it’s a step in the right direction,” said Andy Roe, SurePayroll general manager, on the August hiring increase. “We’ve seen small businesses grow their profitability using technology and innovation, now hopefully we’re starting to see them grow their staffs a bit more.”
The survey, though, also shows that small businesses have become increasingly dependent on independent contractors, also referred to as 1099s. According to SurePayroll, independent contractors now make up more than 6% of all small business employees, which is more than double what it was 10 years ago. In fact, the survey reported that nearly a quarter of small business owners said they’re more likely today to hire an independent contractor than a full-time worker.
“What’s happening right now is you have a lot of skilled people available to do freelance on an as-needed basis,” said Roe. “It allows small businesses to get some really good work from qualified people with very specific expertise, without having to pay the costs of having an employee.”