Automation For The People

Trust the technology and give someone else your payroll headache.

Like doing payroll? A recent survey by International Communications Research (ICR) found that the average small business spends 50 hours per year on payroll--about an hour per week. So how's it going? Do you find processing payroll to be a productive use of your time?

The problem is, processing payroll doesn't just mean cutting checks and updating your books. You also have to fill up all those federal, state and local tax pots with money--you know, the FICA, FUT and US contributions--in a certain way on a certain schedule. And let's not forget the monthly, quarterly and annual payroll reports that have to be filed in ways that can vary by company and even employee.

According to the IRS, the average entrepreneur has to comply with more than 50 payroll tax regulations at all levels of government--a good portion of which change frequently. In fact, they change so often that, by IRS calculations, America's small businesses spend about $16 billion per year just keeping up with the paperwork.

Nonetheless, it's a job that has to be done. But does it have to be done by you? Not when you consider there are people who actually enjoy navigating these confusing waters. They're called payroll service providers. Maybe you should donate your payroll headache to one of them so you can spend that extra 50 hours a year doing something that actually brings dollars to your bottom line--or at least, to the top line.

Mike Hogan isEntrepreneur's technology editor, and he can be contacted at

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This article was originally published in the January 2000 print edition of Entrepreneur with the headline: Automation For The People.

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