The field of Human Resources and administrating all of the tasks that come with it is becoming both more complex and more expensive every year. Using the services of a professional employer organization or PEO can help manage employees, benefits, and other HR aspects so that leaders of organizations can focus on other aspects of running their business.
If you’ve been weighing whether or not to utilize the services of a PEO for your small or medium sized business, here are some thoughts from Jan Kaupas, senior vice president of sales for Extensis Group in an article appearing on the Benefits Pro website.
The National Association of Professional Employer Organizations (NAPEO) that the industry has grown at a rate of 8.3 percent from 2017 -2018. This figure makes the rate of growth 14 times higher than the entire U.S. employment market.
One of the most common myths that hold other organizations from utilizing PEO services is the fear that businesses will lose control over the traditional aspects of their business and employees. The truth is that even when working with a PEO, business owners maintain control over all hiring, firing, and other areas of employee management.
Another widespread assumption is that a business needs to be of a particular size to benefit from the services of a PEO. Kaupas reports that some PEOs are just as happy to work with startups that have just one full-time employee as they are with medium-sized companies with approximately 1,000 workers on staff.
A great many businesses are unaware that using a PEO can also save them as much as 35 percent on HR administration costs, reduce benefits costs, and reduce the amount of employee turnover 10 – 14 percent. With less employee turnover, there is less time spent trying to find replacement workers for open positions, thus further reducing HR expenses.