Orange County Register

California small businesses cut staffing and wages in October, according to SurePayroll Inc, an online payroll service for more than 25,000 businesses.

It is the 14th straight month of job cuts and 9th straight month of reduction in average paycheck for California firms, according to SurePayroll’s data. Year-to-date, the number of employees is down 2.1% and average wage down 2.5%.

In other regions, hiring is up, but average payroll is down.

SurePayroll also surveys small-business owners each month. In the last week of October, optimism levels of those surveyed dropped to 50%, a 10-point decline from the optimism level in September.

“With hiring increasing, the cost of labor declining, and the government’s recent measures to open up credit for small businesses, you’d think small business optimism would be higher,” SurePayroll President Michael Alter says on his Managing People blog for Inc. “But here’s the thing: When we look a little closer, we see that most of that hiring was driven by independent contractors, not employees. And because of continually decreasing wages, less and less money is being pumped into our economy.

“So, while Wall Street is telling us we’re starting to recover, it seems that half of the business owners out there adamantly disagree. And if you ask me, no one is more in touch with the economy and how it affects their business than entrepreneurs. You are playing it safe by opting to hire independent contractors instead of employees — and you should continue to hedge your bets. Now is the time to forget about shooting for huge growth and instead conserve cash.”

The national jobless rate just hit 10.2%, the Bureau of Labor Statistics said today.

Other surveys indicate the jobs picture will improve in the coming months:

• Robert Half International and CareerBuilder say more than half of employers plan to hire full-time workers in the next 12 months while 40% will hire independent contractors and 40% will hire part-timers (no doubt considerable overlap in those responses)
• Intuit Payroll says 44% of its survey respondents plan to hire in the next 12 months
• 12% of members of the National Asso. for Business Economics will add jobs and 31% will cut payroll

Other economy stories…

• Local small-business lending picks up
• Those interest-free federal loans hard to get
• Private employers cut 203,000 jobs in October
• Business owners tap personal assets to survive
• Few eligible for the full 20-week jobless extension
• Senate passes unemployment extension
• AT&T cutting more than 85 O.C. jobs
• Got swine flu? Get 5 paid days off
• State unemployment fund projects a $27.3 billion deficit

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