As signs of more business activity are showing, small-business owners are becoming more open to bringing in more employees, according to a new survey by Insperity Inc.
The survey finds that more than 40 percent of respondents are hiring, a jump from 28 percent in October 2012, while 55 percent of respondents say they are maintaining employee numbers. Only 5 percent of respondents say they are reducing staff, a decline from 9 percent in October 2012.
Compensation also appears to be moving upward, the survey finds. From the first quarter of 2012, average compensation grew by 3.7 percent, though bonuses dropped 0.6 percent. Average commissions also increased by 4 percent, up from the 2.6 gain in the first quarter of 2012. Overtime compensation remains low at 8.7 percent of regular pay. This is lower from the 10 percent level during the last quarter but still up from 8.5 percent in the first quarter of 2012.
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When it comes to performance, 74 percent of respondents say they are meeting or exceeding expectations, an increase from 71 percent during the last survey. Meanwhile, 26 percent of respondents say performance is down, a decline from 29 percent in October.
There also seems to be economic optimism as 28 percent of respondents say this is currently happening, up from 20 percent in October 2012, and 26 percent of respondents believe there will be a rebound in the third quarter or later. Forty-five percent of respondents are unsure.
"Business owners are slowly beginning to implement business plans that they hope will take advantage of any coming economic opportunities," says Paul J. Sarvadi, chairman and CEO of Insperity. "However, as in the previous survey, a significant number of respondents express continuing concerns about the negative impact of governmental policies on business activity."
The economy still ranks as the top concern for business owners; however, this fell from 72 percent to 62 percent. The second major concern is health care reform and rising health care costs as cited by 51 percent of respondents, and hiring the right people comes in at the No. 3 spot at 42 percent.
Through 2013, 59 percent of respondents say they plan to maintain employee compensation at today's rates. This is up from 53 percent in October. Twenty-six percent of respondents expect to increase compensation level, slightly down from October's 29 percent, but this is still higher than 19 percent in July 2012. Only 3 percent of respondents plan to lower compensation levels, and 12 percent of respondents have yet to decide.
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