PEOs: A valued partner during COVID-19

PEOs: A valued partner during COVID-19

by Andrew Sowell, on November 09, 2020
Many small businesses are struggling with the lasting impacts of the COVID-19 crisis. Some have even had to close their doors forever.

But a recent survey has shown that businesses who had the backup of a PEO (Professional Employment Organization) fared far better than the odds would suggest.

A PEO provides comprehensive HR solutions for small and mid-size businesses. Payroll, benefits, HR, tax administration, and regulatory compliance assistance are some of their many services. So how does that help businesses survive when everyone is struggling to stay afloat?

The National Association of Professional Employer Organizations (NAPEO) recently released a white paper from McBassi & Company titled: “How PEO Clients Fared in the First Months of the COVID-19 Pandemic: A Comparative Analysis.”

Researchers talked to business owners about what they did to stay afloat during the COVID crisis and what role a PEO played in their successes.

Compared to other small businesses, PEO clients were:
  • 119% more likely to have received PPP loans
  • 72% more likely to have received PPP loans in Round 1
  • 98% of PEO client PPP loan applications were successful
  • 91% less likely to still be temporarily closed
  • 60% less likely to have permanently closed
Getting a PPP loan with a PEO
PEO clients were able to access PPP loans faster than comparable small businesses. They accessed them more quickly with an extraordinarily high success rate, guiding clients through the PPP loan process, providing and organizing the necessary documentation not only to apply but to manage the PPP loan forgiveness process as well.

Staying open with a PEO
PEO clients are far more likely to be in business than other small businesses. This was not only because of the increased likelihood of supplemental funding but also because companies with PEOs had the support they needed to navigate the numerous new regulations for reopening safely.

PEO clients also had HR backup to assist with the challenges of a fluctuating workforce. PEOs also kept clients on top of return-to-work procedures, new HR-related issues, and helped minimize impacts on furloughed employees.

You can read the full report and see in even greater detail why PEOs are valuable partners for businesses, not just during a crisis, but in times of stability and growth as well.

No one could have expected the crushing impact COVID-19 would have on our nation’s businesses – and there is still a long road to recovery ahead. In the best of times, small businesses that work with a PEO grow 7 to 9 percent faster, have employee turnover that is 10 to 14 percent lower and are 50 percent less likely to go out of business.

If you could use the expertise a PEO can provide, LandrumHR has your back. Contact us to learn more about how we are helping clients through the COVID crisis and what we can do for you and your business.
 
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Andrew Sowell

Andrew Sowell currently serves as the Regional Director of Business Development for LandrumHR. He received his degree in Business Marketing from Florida State University and has an extensive background helping business owners solve problems that impact the bottom line.  His passion is consulting with business owners and highlighting areas where the company can save money, increase profits, improve employee engagement, and protect the business from compliance issues.

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