It’s National PEO Week, a good time to talk about the model behind what we do and why it matters more now than it did a decade ago.
A Professional Employer Organization, or PEO, is a partner that handles the aspects of running a business that don’t show up on a customer’s invoice. Payroll. Benefits administration. Compliance. Workers’ Compensation. HR support. The work that, done poorly, sinks businesses, but done well, gives them room to grow.
Running a business is harder than it used to be. Labor laws change constantly. Benefits administration is becoming more complex. Workforce expectations have shifted in ways most small business owners didn’t sign up to manage. A PEO takes that weight off the owner’s plate so they can focus on the work only they can do.
The outcomes show up in the data. According to NAPEO’s 2024 research, businesses that work with a PEO grow more than twice as fast as comparable companies, have 12% lower employee turnover, and are 50% less likely to go out of business. Those are the numbers behind a fundamentally different way of running a business.
Just as important is what the PEO model unlocks for employees. Small and mid-sized businesses partnering with a PEO can offer Fortune 500-caliber benefits (health plans, retirement, employee programs) that they often couldn’t access on their own. That changes the talent they can attract, how long those employees stay, and what those teams can build together.
Nationally, the PEO industry now supports more than 200,000 small and mid-sized businesses and 4.5 million employees. That’s a meaningful share of the American workforce, and most of it is happening in small- and mid-sized companies that anchor local communities.
Landrum has been doing this work for more than 55 years. We see what the PEO model does for the businesses we serve. Owners get their time back, teams grow stronger, and companies can plan for what’s next rather than react to what just happened. That’s the work, and National PEO Week is a good week to explore the benefits.
Sources: NAPEO 2024 White Paper, “PEO Clients: Faster Growing, More Resilient Businesses”; NAPEO Industry Overview (napeo.org).
