Survey: Georgia small businesses see signs of recovery

Georgia's small businesses, mired in the long economic slump,  may be seeing small signs of improvement, a new survey suggests.

The average paycheck paid by small employers in the state increased an average of 1 percent in the fourth quarter of 2009 compared to the same period in 2008, marking the first such uptick during the recession. Early indications are that the trend has continued in the first two months of this year.

But not all the news is good. Contract workers, not permanent full-time employees, continue to make up most of the limited amount of  hiring. And more hours  worked by existing employees accounts for most of the paycheck increase, rather than wages earned by newly added employees.

The data was reported in the SurePayroll Scorecard, a  national economic indicator that tracks the U.S. small business economy using hiring and salary data from more than 25,000 firms. SurePayroll is an online payroll service company.

"The recovery has started," said SurePayroll president Michael Alter. "Georgia is off the bottom. It was an ugly picture there in  the third quarter (of 2009). Things have changed."

He said the latest data represents a major shift from last year when wages were declining and small businesses relied increasingly on hiring contract workers.

The number of contract employees in the  workforce continues to rise, the survey found, representing an average of 8.2 percent of the state small business workforce at the end of last year.

"There's not enough revenue in the business," Alter said. "Not enough customers. Until we fix the demand side, you're not going to see increased hiring."