A vast majority of small-business owners plan to hire new employees or maintain current staffing levels, a new survey says. The study from Insperity, a professional employer organization, found that 40% of owners expect to add staffers, while 52% aim to hold steady on worker count.
Encouragingly for employees, 39% of survey respondents plan to pay workers more. That’s far better than last October, when an Insperity survey revealed that only 23% of owners anticipated that they would hike pay. Also, 48% of respondents anticipate that they will maintain compensation at current levels. Only 2% of owners say they’ll lower compensation levels, while 12% are unsure how they’ll handle pay moving forward this year.
The general trend toward stronger pay is already underway. Overall, average compensation for the first quarter of 2015 was 2.5% higher than the same quarter the prior year, the survey found. Bonuses increased too, rising 11.6% compared to the same quarter in 2014. Significantly, overtime accounted for nearly 11% of regular pay, a positive bellwether for hiring since anything above 10% indicates a need for additional employees.
While the survey revealed a generally optimistic mood, a couple of downbeat notes were sounded. The number of businesses planning layoffs rose from 3% in January to 8% in the new survey. Also, while 40% of respondents expected to add staff, that was down from the 50% in January who said they expected to hire.
“Business owners are continuing the solid growth pattern reflected in the January survey, but at a somewhat slower pace,” said Insperity Chairman and CEO Paul Sarvadi. “One of the key contributions made by the nation’s small-business community is the ability to adjust quickly to economic uncertainties and turn them into profitable opportunities. The survey results suggest they are doing just that.”
Insperity conducted the survey this spring, polling CEOs, CFOs and other executives in a range of industries from its base of approximately 5,400 clients.