Small Business Layoffs at 14 Month Low
Technology companies continue adding for growth.
SAN LEANDRO, Calif. (April 12, 2011) – Employment trends in the knowledge worker economy remain positive yet with a pause in hiring and a continued drop in all forms of terminations, all reflecting a focus on developing the current talent pool with selective hiring where needed in growth-stage businesses. Hiring rates trended down 6 percent month-over-month and were 6 percent below the strong rates from March 2010. Total terminations, reflecting both voluntary and involuntary exits from the workforce, were at a 14 month low.
“Technology companies continue to hire despite the broader economic challenges of a declining dollar, rising commodity prices, and an uncertain interest rate environment. We continue to see technology companies buck the broader trend of retrenchment,” said Jimmy Franzone, TriNet’s vice president of corporate development. “In this segment of the economy, terminations are at a low point of below 6 percent on an annualized basis with resignations at an additional 9 percent. These values reflect an environment in which companies have largely completed restructuring and are focused on growing into the future.”
- Monthly Hiring rates trended down 6 percent month-over-month to 2.2 percent and were 6 percent below year-over-year rates; likely reflecting some retrenchment as companies prepare for the remainder of 2011 amid macro-economic uncertainties.
- Monthly Turnover rate trended 10 percent below February to 1.2 percent and is 26 percent below March 2010’s figure; this reflects a focus on a continued upgrading of talent in growth-stage businesses and indicates increased employee stability. Terminations continue to be outweighed by resignations, a further indication of a healthy labor market, as most resignations are driven by an employee’s desire to move on to a more appealing role.
- Average annual compensation increased 1 percent year-over-year, indicating a robust employment market for the highly educated workforce in TriNet’s client base. As described in the earlier SMBeat releases in 2011, this income growth drives significant disposable income growth.
SMBeat provides a detailed analysis and a predictive forecast for trends in key human capital economic indicators for small businesses. TriNet generates the payroll information by tracking real-time movements within its base of approximately 3,000 entrepreneurial businesses, with between 10 and 150 employees, and earning approximately $100,000 in annual base salary. These companies fall primarily into three broad industry segments: technology, professional services, and financial services. SMBeat aggregates and reports data reflecting compensation, hiring and retention (both involuntary terminations and voluntary resignations), and also provides ongoing analysis of contributing factors to these trends, including regional, industry and seasonal variables. Additional details can be found on the company’s SMBeat web page http://www.trinet.com/smbeat.
TriNet is a trusted partner to small businesses, providing critical HR-related services on an outsourced basis. TriNet’s solutions help contain costs, minimize employer-related risks and relieve administrative burden to keep an entrepreneur’s focus on core business functions. From routine employee benefits service and payroll processing to high-level human capital consulting, TriNet's PEO expertise is integrated with every facet of a client’s business. TriNet specializes in serving fast-moving companies in fields such as technology and financial services, who recognize that top-quality employees are the most critical competitive asset. For more information, please visit http://www.trinet.com.
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