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Private Companies See Record Profits
By Connor Dougherty, August 23, 2011
Private companies have seen dramatic increases in their profits per employee, according this release from research firm Sageworks Inc. that underscores how companies of all sizes continue to bounce back from the recession despite high unemployment.
According to Sageworks, private company profits per employee were a cumulative $15,278 through August 22, 2011, not adjusted for inflation – 22% higher than the total for 2010. This could all change, of course. If the economy continues to slow or fall back into recession, sales could slow – or employees could be cut (or both).
Profits per employee in 2011 are so far 12% higher than the total in 2007. The last recession began in December of 2007.
“These businesses may find that the ‘new found efficiency’ is cost effective, and that may deter them from bringing on new hires in the short term until sales prove to be sustainable,” the firm notes in a release.
Sageworks aggregates its data anonymously from finance professionals that subscribe to its data. The incentive for providing accurate data, the company says, is that it allows subscribers to compare their clients to competitors in the same and other industries.
For the full story featuring Sageworks’ private company data, please visit The Wall Street Journal – Private Companies See Record Profits.