Paycheck sizes have fallen 1.3 percent year-to-date at small businesses, according to figures from payroll processor SurePayroll, with hiring also declining 2.4 percent.
The company’s July 2011 Small Business Scorecard found optimism among small businesses has plummeted to 47 percent, down 20 percentage points from 67 percent in June.
SurePayroll president and CEO Michael Alter believes that uncertainty over the debt ceiling played a contributing role in the decline in optimism.
“The small business owners out there are making decisions based on their perception of the world,” he said. “What our clients are telling us is that a lot of the change in optimism has to do with the gridlock that was taking place. Without clarity on where things were going to go, they’re all sitting on the sidelines waiting to make decisions for their business. That’s why you saw lower hiring and not paying as many hours to the workers as they have. As we move further into the summer, and we now have some clarity in Washington that we’re going to get around the deficit issue, to me the real question is will that bring the small business owners off the sidelines and into making a decision moving forward? According to our data, it’s still uncertain. Clearly right now, based on the data, it’s now going in the wrong direction, so I’m not as optimistic about a turnaround based on the data I’m seeing.”
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