Employco Group 2007 Summer Forecast Market Survey

May 23, 2007; 08:45 AM

In today’s increasingly competitive job market, small businesses have reinforced their commitment to employee retention instead of focusing resources on recruiting initiatives or new benefits policies designed to attract new employees, according to Employco Group’s 2007 Summer Forecast Market Survey.

For example, 21 percent of respondents said they have expanded training and professional development in 2007 in order to increase employee retention, while 89 percent of small businesses said they consider themselves “as competitive” or “more competitive” on salary when compared to larger companies.

Despite recent reports to the contrary, the overwhelming majority of small businesses have been slow to adopt flashier benefits programs such as telecommuting, flex-time or wellness programs.  Instead, small businesses are more interested in providing health insurance, life insurance, dental coverage and 401k options that rival benefits of Fortune 500 companies, which prepares small businesses to compete for talent with larger corporations.

Small businesses also plan to increase their workforces moderately in 2007 but interestingly, new college graduates still remain a largely untapped resource at a time when larger companies are increasing college graduate hiring this spring/summer.  This gap suggests that small businesses continue to lack the resources and infrastructure necessary to effectively manage the recruitment of college graduates despite an interest in expanding their workforce.

Highlights of Employco’s 2007 Summer Forecast Market Survey include:

Ø      97 percent of respondents do not offer a telecommuting program that allows employees to work remotely.  However, the majority of those that do offer a telecommuting program believe employees are “as productive” as their office counterparts.

Ø      Only 4 percent of respondents offer a flex-time schedule for interested employees.

Ø      99 percent of respondents do not offer any type of wellness program that incentivizes employees to actively manage their health (i.e. stop smoking, exercise, nutrition, etc.)

Ø      The overwhelming majority (88 percent) of respondents report that 5 percent or less of their respective workforces will be eligible for retirement in the next five years, suggesting that small businesses may be uniquely positioned to weather the expected retirement of baby boomers.

Ø      Though not expecting large amounts of turnover, 62 percent of respondents still have a succession plan in place to handle any retirement departures, signaling that small businesses are well prepared to handle potential succession issues.

Ø      The majority of respondents (70 percent) plan to increase their hiring by 5 percent in 2007.

Ø      New employees are not likely to be college graduates as only 8 percent of respondents actively recruit new college graduates for full-time employment and no respondents plan to increase recruiting efforts targeted toward new college graduates.

Ø      Despite the financial flexibility of smaller businesses in comparison to their larger, public competitors, the signing bonus as a recruiting tool is near dead – only 1 percent of respondents offer signing bonuses to new employees.

Methodology

Employco Group recently distributed a survey to nearly 400 small businesses owners and top executives, including presidents, CEO’s, COO’s, CFO’s and other senior executives. The survey was completed by 241 respondents, representing a 61.5 percent response rate.  Respondents include executives from small and medium-sized businesses throughout the United States with whom Employco serves.