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March 2013 brought about substantially less job growth in the U.S. than expected, according to the Bureau of Labor Statistics. Analysts such as those at the Huffington Post point to an increased payroll tax as perhaps one reason for employers’ hesitation to create new jobs. If you’re struggling to afford the new hires you think your business needs, consider outsourcing departments such as human resources.

What’s a PEO?

Not only can PEOs (professional employer organizations) take over the entire human resources department of your business, they provide more information to both existing and potential clients via online seminars and personalized, one-on-one consultations. PEOs are in the business of serving other businesses. Hire them for as much or as little help you think necessary, for short-term contracts or for long-term periods.

If you’re a small business seeking to expand your human resources department, but can’t imagine hiring new employees for basic business operations while dealing with an increased payroll tax, outsource to a PEO. The goal of a PEO is to free up your resources so you can focus on achieving your business goals without stressing about the details of day-to-day operations.

Reasons to Enlist a PEO

You can’t afford to make as many hires as you’d like with increased taxation. Rather than let your business fail to meet its maximum potential, enlist a PEO’s help. Options include:

  • Outsourcing departments such as human resources. This means tasks such as payroll, tax payment/filing, health benefits, unemployment claims and hearings are in the hands of professional.
  • Inviting PEOs to hold training sessions and seminars to provide your current employees with more expertise. Then, your employees can handle more tasks.
  • Tasking PEOs with drafting documents such as employee handbooks. This way, your employees are on the same page when it comes to what you expect of them and how you can all achieve maximum productivity.
  • Taking advantage of bilingual services offered by PEO. Thus, you don’t have to hire someone on staff purely for documentation and training translation.

You become a PEO’s client, not its employer. You don’t have to worry about payroll tax; in fact, you won’t have to worry about how to deal with taxation changes for your current employees if you hire a PEO to help with tax filing and payment. If you have an issue, all you have to do is speak with a representative.

Hire More Employees

An increased payroll tax has you wondering if you can afford to hire anyone and offer them attractive compensation. However, if all businesses stagnate and never hire new employees or create new jobs, the overall economy performs poorly. That can turn around and impact your ability to sell your products or services. So make a point of hiring new employees and creating new jobs. You can afford it if you zero in on creative, necessary positions that will most help your business.

hire-employeesIf you outsource daily business operations to a PEO, you won’t have to worry about payroll tax with them. You pay a fee to hire them; you don’t issue their paychecks. That frees up more money in even a limited budget to hire people who can take your business in a new direction. Leave the basic business operations to professionals, and attract innovative minds to your business that focus on designing, promoting and selling your services or products.

Hiring a PEO helps businesses afford the support they need, even if they can’t afford to hire new employees. If it’s a matter of a limited budget for new hires, use a PEO for day-to-day business operations and allocate your new hire budget for innovators, salespeople and other employees who can focus on your business’s goals. Any payroll tax increase isn’t an issue if you’re not hiring employees on payroll but are instead paying another business to take care of behind-the-scenes operations for you.

About the Author: Evelyn Quiroz is a contributing writer and financial consultant. When suggesting ways for businesses to adjust to new federal requirements, she recommends nationalpeo.com. Visit their site for more information.

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