Seventy percent of executives at small businesses expect to add employees in 2007, and 59 percent expect to increases employee compensation, according to a survey by Administaff.
Only 5 percent of respondents expect a drop-off in their workforce in 2007. A third of respondents plan to maintain their current compensation levels in 2007. Sixty-four percent expect to pay more overtime.
"We are seeing business owners express optimism as their companies continue to grow," says Paul J. Sarvadi, Administaff chairman and chief executive officer. "That kind of confidence helps keep the economy moving ahead."
The firm also released third-quarter compensation data compiled from its client base of more than 5,000 small and medium-sized businesses throughout the country.
"The outlook is bright in the small business community," Sarvadi says. "Average compensation is up 7.1 percent in 2006 versus a 5.8 percent increase for 2005, bonuses are up 12 percent and commissions--an indication of the sales pipeline for our client base--are up 5.2 percent."
Executives cited "hiring the right people" as a top issue for 2007. A majority--67 percent--said they will increase their efforts to retain employees next year.
To retain employees, most said they planned to review and take steps to improve compensation, incentives, bonuses, and commissions. Others said they would strengthen their benefits packages.