The PEO Industry Footprint is Growing in Florida and Michigan

The PEO industry is growing – there is certainly no doubt about that. Consider that a few short years ago, a large percentage of even the most informed small to medium sized business owners had no idea what a Professional Employer Organization (PEO) was, and certainly had not considered working with one. That’s changed, in a big way: Changes in the marketplace, uncertainty surrounding health care, increases in Workers’ Compensation costs and other factors have given PEOs greater visibility, and a more central role in safeguarding the success of growing businesses.

A recent study conducted by McBassi & Company estimates the PEO industry’s gross annual revenues at between $136 and $156 billion. The study further cites between 156,000 and 180,000 PEO client companies, and somewhere between 2.7 and 3.4 million employees receiving services from PEOs. Obviously, none of these are small numbers, and virtually every current and emergent trend would indicate that they are likely to continue to rapidly grow in the near-term future.

While the industry’s overall national growth is impressive in and of itself, the study includes another remarkable, little-noticed fact: Two of the states leading the nation in the numbers of PEOs who call them home aren’t necessarily the country’s biggest (although they could perhaps be considered the most forward-looking). Both Florida and Michigan boast impressive numbers of resident PEOs, with Florida leading the pack at 107 – beating out much more populous states, including New York and California. Meanwhile, Michigan’s PEO census nearly equals New York’s at the low estimate (47 vs. 49) and handily beats it at the high-end estimate (59). Michigan is similarly neck-in-neck with population- and business-dense California.

To us, that means several things:

Businesses in states with economies hit hardest by the 2008 economic downturn, as both Michigan and Florida were, have found that PEOs offer both competitive and survivability advantages that they can’t afford to ignore.
States forced by adverse market conditions to adopt new approaches to business are leading the way in demonstrating the efficiencies and economies of scale that PEOs make possible.
States where PEOs prosper, and where by extension the increased operational efficiencies PEOs have to offer are more easily leveraged by small to mid-sized businesses, will play a strong hand in reshaping the HR landscape in the coming years as the PEO/HR outsourcing model is further proven in practice and gains in prominence.

We have to say that these are developments we’ve seen coming, and have had a hand in helping to make happen. Trion maintains a strong presence in both Michigan and Florida – the consequence of our early recognition of these states’ potential as powerful centers of activity with high growth prospects. We also were quick to recognize that these states’ unique business climates and unique business needs lend themselves particularly well to serving as environments where a truly professional, efficient PEO could effectively serve its clients, and prosper in doing so.

The PEO business is growing ever stronger in the mitten and sunshine states, and Trion is pleased to be helping to lead the charge.

Helping Staff Cope with Change

CHANGE. For some, it’s a word associated with challenge and excitement; for others, it inspires revulsion, resentment, or dread.

Considering the degree to which the American workplace has changed over the last quarter century, both answers are understandable. Some change has been for the better; some decidedly for the worse. And some could be either, depending on your perspective. But two things seem certain: The last few decades of change have been rapid and transformative, and continuing rapid change seems inevitable and unstoppable.

Fortunate people and fortunate companies have managed to ride the tide of change up to this point – but each workplace upheaval leaves some fallen by the wayside. Adaptability, it seems, is no longer optional for survival. So how do we help our businesses deal with change? It turns out that in large measure, helping employees adapt helps companies adapt too.

Here are a few steps that will help your company and your people navigate the road ahead, whatever it may bring:

Foster collaboration. When it comes to change of any kind, some people are early adopters while others tend to stick with the familiar. Left to themselves, people addicted to familiar routines tend to be outpaced when workplace changes happen. In a collaborative environment, however, employees have the opportunity to share knowledge, ideas—and crucially, mutual encouragement. When it’s time to adopt new processes or technologies, that interactive and collaborative dynamic goes a long way towards making the transition smooth.
Plan for change. From the organization’s highest levels, make it a point to expect change, anticipate it, and welcome it when it arrives. Leaders have the opportunity to set the tone for their subordinates, and to create plans to help employees adapt as needed. Whether it’s developing extensive retraining programs, or simply being prepared to give employees authoritative information about coming transformations, planning ahead helps avoid operational disruption and employee resistance.
Compensate for adverse results where possible. Does a coming change mean that some employees will be affected adversely – working longer hours, losing a title, or losing a job? It’s not always easy or even possible to balance the impact of such outcomes, but when it can be done it usually should be. It’s no secret that performance is keyed strongly to morale, and even if some expense or effort is required to sustain morale during business transformation, the investment is usually well worth it over the longer term.
Encourage dialogue. People fear what they do not understand, and fear is a lousy basis for a good attitude on the part of your employees. Inviting questions, giving straight answers, and encouraging discussion can help your employees to come to grips with transformational workplace events like mergers, automation, efficiency drives, downsizing, or restructuring. Even when the answers you give aren’t exactly what people wanted to hear, giving straightforward responses inspires confidence, encourages loyalty, and helps employees overcome fear of the unknown.
Acknowledge – and appreciate – your team’s strengths. People tend to appreciate others who appreciate them. When change is coming, express your confidence in your staff’s ability to handle it productively, and thank them in advance for their willingness to adapt and for helping to make the transformation as smooth as possible. After the fact, show your appreciation – where deserved – for cooperation and a job well done. Not only will this make current changes easier for employees to swallow, it builds a basis of trust you can call upon the next time a significant shift is coming.

Change is seldom easy, but it is often necessary—and as the whirlwind pace of modern business shows, it is always coming whether we like it or not. Companies that not only survive but thrive are usually the ones that lay out the welcome mat for change, and which help their employees to do the same.