Small businesses show modest hiring increases

Apparently, people are a little more nervous these days.

Or maybe they finally have money for security.

Whatever the reason, business is up at Sting Surveillance, a Las Vegas company that installs alarm and video-monitoring systems inside local homes, offices and stores.

After a two-year freeze on creating new positions, Sting Surveillance has added an installer and a salesperson to its 35-person staff in the last 45 days, with at least half a dozen more jobs possible by 2011's end, said President Jonathan Fine. Behind the hiring boost is a 30 percent jump in sales in the first half of 2011.

"People are buying homes that were foreclosed on, and as they get settled in, they're calling us for systems," Fine said. "We're also seeing people start to open up new businesses, especially quick-serve restaurants."

A new payroll report indicates that Sting Surveillance has company on the local hiring lines.

Paycheck servicing company SurePayroll's Small Business Scorecard, which analyzes hiring among companies with 100 or fewer workers, showed a 1 percent increase in the size of local small-business work forces in the first half of 2011. That compares with a 4.9 percent decline in small-company labor forces across the West, and a 2.3 percent falloff nationwide.

Michael Alter, president and chief executive officer of Illinois-based SurePayroll, credited Las Vegas' growth to the major beating the region took during the national recession. The city's economy bottomed out below just about any other market's economy, so hiring could really only go up, Alter said.

Still, the data do hint that small-business owners feel better about sales prospects, Alter added.

"The dynamic we're seeing right now in Las Vegas is a positive dynamic. It's showing some growth and some hope," he said.

Bill Rosado, president of Las Vegas-based ManagedPAY, said SurePayroll's 1 percent local growth estimate matches trends he sees among clients of his payroll and human resources company.

Rosado added two payroll processors in the last two weeks to handle a "marginal increase" in paychecks serviced as customers added employees. He's also looking for an information-technology employee.

"I think many of us feel like we have weathered the storm. We're not as determined to hold onto reserves and working capital in case things get worse," Rosado said. "The fear is subsiding, and businesses are willing to start spending, not only with regard to hiring and pay increases, but in buying that additional computer or upgraded equipment they've needed."

Dig deeper into SurePayroll's data, though, and you'll see signs that employers remain wary.

Many local small-business hires through June were independent contractors, which means companies needed additional labor but weren't confident enough to chance full-time additions.

Improved hiring is also pushing down the average local small-business paycheck, which SurePayroll said fell 3.7 percent from January to June, to around $31,000 a year. That's because new contractors and full-timers alike translate into fewer overtime hours for a company's existing employees.

Hiring among local small businesses should continue through the rest of 2011, though the pace won't likely pick up noticeably, observers said.

"I think there's still a lot of uncertainty about what's going to happen," Alter said. "If I know what deficit cuts and taxes will be, I don't care what direction they go in. I just need certainty. With certainty, I know how to run my business. Without it, I sit on the sidelines and watch."

Plus, the local commercial real estate bust hasn't fully played out, Rosado added. As the market continues to slide, the Las Vegas economy could languish, and companies may hesitate to grow much more.

But for Fine, at least, macroeconomic issues matter less than quality control at Sting Surveillance.

Fine said he'll definitely add more workers in the second half of 2011, including four installers, another customer-service agent and three or four salespeople. Even if the new hires cost Sting in the near term, they'll be worth it in the long run.

Said Fine: "We may lose money for six months (on a new worker), but if not hiring that person means our clients have to wait an extra day for a service call, then we'll hire the employee. Our business model is based on longevity. If I sell you an alarm, I need to keep you happy for eight years. If you're unhappy one time, your account goes somewhere else. As long as we're still adding alarm systems, we'll catch up on the cost of new hires."

Contact reporter Jennifer Robison at jrobison@reviewjournal.com or 702-380-4512.