El modesto crecimiento del empleo, el aumento de los PIP y los beneficios de las pequeñas empresas

Hey everybody, it's Gene Marks and welcome to this week's episode of the Paychex THRIVE Week in Review podcast. Thank you so much for watching or listening. This is the podcast where we take a few items from the news that happened during the week and how it impacts your business and mine. So, let's get right to the news, shall we? 

The first comes from Paychex itself. The monthly Small Business Employment Watch has been reported and released, and I wanted to share with you some of the information from this about jobs at Paychex is reporting. 

The headline of the story is U.S. small business job growth rate remains steady in November. According to the small Business Employment Watch, small business job growth across the U.S. remained relatively consistent in November and has averaged about the same index over the past 11 months, representing modest employment growth. Hourly earnings growth – 2.97% – and weekly earnings growth – 2.84% ­–for workers stayed below 3% for the fourth and 10th consecutive month, respectively.

“Our national jobs data for November, which is based on real payrolls from 350,000 Paychex customers, indicates small business owners are retaining workers as employment growth holds steady and wage growth continues to trend in more manageable directions,” says John Gibson, who is the Paychex president and CEO. 

Another thing of interest to note in the small Business Employment Watch is just the impact that the hurricanes during the year had on jobs, and we are seeing recovery. The report said that there was a significant increase in job growth in some areas as recovery efforts continued after hurricanes Helene and Milton. Construction. Job growth in Florida increased 2.55% points to an index level of 99.95, which is a very strong index. Weekly hours worked in North Carolina were down in November, but one-month annualized growth rebounded among the sectors following Hurricane Helene.

So, the takeaway from the monthly Small Business Employment Watch from Paychex is that job growth remained steady in November and earnings are still for hourly workers below 3% for quite the past few consecutive months. 

Moving on and still talking about employees, there was a report in the Wall Street Journal this week about something called performance improvement plans. Are you familiar with them? Well, they are the most hated way of firing someone, according to the Wall Street Journal, but they're now more popular than ever.

In the messy business of getting rid of employees, the performance improvement plan is “having a moment,” says the Wall Street Journal. A performance improvement plan is usually a list of tough-to-achieve goals to be completed within 30 to 90 days, and if you can't shape up, you're out. 

The percentage of workers who are subject to performance actions, including these plans, is on the rise. In 2020, 33.4 people for every 1,000 workers had documented performance issues, according to software firm HR Acuity, which conducts an annual survey of this. In 2023, that number went up to 43.6 workers out of 1,000 who were involved in these formal, performance procedures. That includes, of course, performance improvement plans. 

Performance improvement plans are intended to bring consistency and fairness to the way employees are judged and manage their stated goals to lay out a path for improved performance, and sometimes it works. That said, many workers and even managers say they're used primarily to provide legal cover for employment lawsuits or to cut costs without announcing layoffs.

So, do you have a performance improvement plan in your business? Well, it sounds like they're on the rise, and it kind of makes sense for a lot of businesses, if not just to give a bit of a framework to an employee to try and keep their jobs, but also a little bit of legal cover for you as an employer, as well, where you're saying and documenting that you gave the employee every chance in the world to meet these goals over a period of time. They still didn't meet him, and that's the reason why you're terminating their employment.

Performance improvement plans are on the rise when nobody seems to like them, but they still remain very, very popular. 

Finally, a report that comes from NerdWallet, the finance site. They did a report on small businesses, their 2024 Small Business Survey. They surveyed over 2,000 adults, among whom 425 currently owned a small business, and they did this in October. I wanted to share with you three of the biggest findings from this report from NerdWallet. 

Number one, small business ownership is common, and many small businesses are new. Almost 1 in 5 Americans, about 19%, currently own a small business. Among them, more than a quarter – 26% – said their business was started within the past 12 months.

Number two, finding and retaining customers is the main issue for small businesses, right? More than 9 in 10 small business owners – that's 93% of them – said they're facing challenges right now, with the most commonly cited challenge being finding or retaining customers, that's 54% said that. 

And finally, most small business owners find owning their business rewarding. More than 4 in 5 small business owners – 82% – said that owning a small business gives them work life balance they want, and 72% say they would open another small business in the future.

Not going to say that you're going to become a super-rich gazillionaire owning a small business, but there are certainly a lot of benefits to doing that, which is why so many people do own small businesses and why small business ownership has been on the rise.

My name is Gene Marks and you have been watching or listening to the Paychex THRIVE Week in Review. If you want any advice or tips or help in running your business, please sign up for our Paychex THRIVE newsletter. Go to paychex.com/thrive.

Again, I appreciate you watching. We'll be back next week with some more news that impacts your business and a few thoughts on that news. Thanks. We'll see you then.

This podcast is property of Paychex, Incorporated 2024. All rights reserved.