PEO Solutions for Businesses in Illinois

Illinois prides itself on its diverse economy and the fact that more than 30 Fortune 500 companies established headquarters in the Prairie State. The Illinois Department of Commerce and Economic Opportunity lists insurance giants State Farm and Allstate, as well as franchise staple McDonald’s, retail pharmacy chain Walgreens, and United Airlines among its mainstays.

These companies can benefit from the 2.3 million individuals (43.6% of all workers in Illinois) employed by the 1.3 million small businesses that make up 99.6% of all businesses in the state.¹

With its central location, its well-developed infrastructure – railroads, ports and waterways, and an interstate highway system that is the nation’s third largest – and about 200 institutions of higher learning consistently producing well-educated jobseekers, Illinois has helped the Midwest region remain first for small business employment growth since June 2024.² Chicago remains in the top 10 in job growth among the 20 metros reported on by the Paychex Small Business Employment Watch (SBEW) from December 2024. At $35.01, Illinois is top 4 in hourly earnings and, according to the SBEW from December 2024, has seen a 2.31% growth.

Even with the moderate job and hourly wage growth in the region and in Illinois, as reported on the December 2024 Small Business Employment Watch, businesses both large and small face challenges. There is the nonstop grind of finding quality individuals to work while trying to keep on top of a regulatory landscape that in 2024 had more go-rounds than the Ferris wheel at the Navy Pier in Chicago with on-again, off-again requirements under changing Overtime rules from the U.S. Department of Labor, not to mention a similar path with the Department of Treasury’s Beneficial Ownership Information filing requirements.

Many of these issues could become time consuming and costly for an HR department or those who handle HR administration for a business. A Paychex survey reported that 34% of leaders indicated their businesses spend more than 10 hours per week on HR tasks, at costs between an average of $172,000 for small businesses and an average of $414,000 for large businesses.³

Let’s look at how a Professional Employer Organization (PEO) can help your Illinois business.

Why Work With a PEO in Illinois?

Businesses looking to tackle their HR administrative tasks and be more efficient while doing so should know that a PEO can support processing payroll, helping maintain compliance, administering benefits, and improving workplace safety. And working with a PEO won’t deny employers the ability to run their company; business owners continue managing employees and the operations in the PEO relationship. And if you have an HR team or even if you lack specific individuals who can handle HR, a PEO can add value by helping support your specific circumstances.

The search for good people and the ability to keep them continues to be an issue, both in time and cost, and with the financial impact of turnover currently hitting businesses at an average of $9,379 per employee, according to a Paychex survey, retaining and engaging top talent is at a premium.³ Businesses can combat that with a PEO, and the National Association of Professional Employer Organizations (NAPEO) has found that those businesses that work with a PEO have 12% less turnover.⁴

How Does Working With Paychex Provide Efficiencies and Insights?

Improving productivity and streamlining HR administration can be achieved with planning and the right solutions. Paychex PEO* provides its all-in-one HR technology platform to help businesses.

• HR administration: Businesses get assistance with recruitment, retention and engagement, onboarding, training, and more with dedicated HR support.
• HR technology: Save time and simplify tasks with self-service so employers and employees can easily update information on payroll, benefits, and personal data.
• Payroll administration: Gain peace of mind knowing that your payroll is processed, taxes calculated and remitted on time. The hassle of state unemployment insurance administration also is reduced with Paychex PEO.
• Employee benefits: With Paychex PEO vetting benefit packages directly with carriers, your business can save time and money while gaining access to Fortune 500-level benefits that help attract and keep good employees. These benefits include health insurance (medical, dental, and vision) and retirement plan options that top talent is seeking.
• Risk management: With Paychex PEO, your business gains a safety specialist who can conduct training and audits that can enhance workplace and employee safety efforts.
• Compliance: If your business has 15 or more employees, there are new pay transparency requirements in 2025. Are you aware of the Illinois Secure Choice Retirement Savings plan mandated by the state for businesses with five or more employees? Our HR Professionals are supported by a team of compliance analysts to help proactively identify potential risks and offer actionable HR advice.

Working with Paychex PEO provides other advantages, among them the potential to increase employee and business productivity, spur growth, and give employers peace of mind.