Business growth For those of us who have been part of the Professional Employer Organization (PEO) industry for a generation, it came as no surprise. Our clients get it too. Now, in a white paper authored by Dr. Laurie Bassi and Dan McMurrer of McBassi and Company, it is clear that the proof is in the numbers. Published on September 16, Professional Employer Organizations: Keeping Turnover Low and Survival High speaks to the most compelling reasons yet to partner with a PEO.

Dr. Bassi is a global leader in the field of applying analytics in Human Resources. She has authored more than 90 published papers, was a previously a tenured professor of economics and public policy at Georgetown University and holds a Ph.D. in economics from Princeton University. Dan McMurrer is a chief analyst at McBassi and received his M.P.P. in public policy from Georgetown University.

Their research is detailed and the results are compelling, but the bottom line is what matters most. In short, companies who partner with PEOs:
• Grow 7-9% faster
• Have 23-32% lower employee turnover
• Are 50% less likely to go out of business

With respect to employee turnover, the data by industry is noteworthy as well. The differences between actual and expected employee turnover rates for PEO clients show the following:
Percentage points by which PEO client’s employee turnover rate is lower than expected
• Professional, Science and Technology Services 23.0%
• Construction 17.0%
• Finance and Insurance 15.4%
• Wholesale Trade 7.3%
• Health Care, Social Assistance 6.0%
• Manufacturing 2.3%

For Massachusetts based businesses, the best news may be the impact on business failure rates, given the preponderance of white collar businesses located in the Commonwealth. The differences in actual and expected annual business failure rates, PEO clients, by industry, using most conservative specification:
Percentage points by which PEO client’s business failure rate is lower than expected
• Professional, Science and Technology Services 6.3%
• Finance and Insurance 5.8%
• Construction 5.7%
• Administrative and Waste Services 5.3%
• Manufacturing 1.2%
• Health Care, Social Assistance 0.8%

As always, the devil is in the details, and McBassi provides plenty of that. We suggest a thorough reading of this comprehensive report that supports what we have known since 1991. For another perspective, see what our clients have to say.

If you would like more information on how a PEO can benefit your business,  please reach out to Genesis HR Solutions at or 800-367-8367.

Genesis HR Solutions is the premier PEO provider for Massachusetts based businesses.