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SurePayroll Sees Paychecks Rising at Small Businesses

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Glenview, Ill. (February 7, 2013)

By Michael Cohn

The average paycheck size rose slightly by 0.6 percent in terms of gross pay in January, according to payroll provider SurePayroll, although employees still lost money in their take-home pay from the expiration of the payroll tax cut.

Michael Alter

The company’s January 2013 SurePayroll Small Business Scorecard showed month-over-month hiring down 0.1 percent and average paycheck up 0.6 percent, the third consecutive monthly increase in paycheck size. Small-business owners' optimism sits at 57 percent, only two points higher than last month.

“It's the Yogi Berra economy in 2013, déjà vu all over again,” said SurePayroll CEO and president Michael Alter in a statement. “Small-business owners appear to be approaching 2013 much the same way they've approached the last few years. There’s slow growth in revenue, but not enough to account for new employees. While the average paycheck has gone up, so did the payroll tax, and it means existing employees are probably working longer hours. We haven’t seen unemployment go down significantly for small businesses.”

Small-business owners were also surveyed about the 2.0 percentage point payroll tax increase. Results showed 87 percent of small-business owners have not been asked for raises to make up for the increase and 80 percent do not plan to budget for such raises. Small business owners mentioned bonus programs based on performance, price increases and paying less on debt as ways to mitigate the impact of the payroll tax increase.

Month-over-month SurePayroll Scorecard data showed hiring was down 0.1 percent and the average paycheck was up 0.6 percent. Hiring was down month over month in every region of the country except for the South, where it was up 0.2 percent. Paychecks were up month over month across the country, including 0.7 percent in the Midwest; 1.0 percent in the Northeast; 0.4 percent in the South; and 0.4 percent in the West.

Year over year, nationwide hiring was down only 1.2 percent and paychecks were down 0.3 percent. Year over year, the South was the only region where hiring was up 1.9 percent and paychecks there were down 0.5 percent. The West showed a hiring decline of 4.6 percent, with paychecks flat. Hiring in the Midwest was down 1.8 percent while paychecks were in positive territory, up 2.8 percent. In the Northeast, hiring declined 2.1 percent and paycheck size fell 3.2 percent.

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