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Paychex CEO: No Recession Looms for Small Biz
20 Dec
Summary
- Labor growth for small businesses is solid but moderating.
- Small businesses are focused on managing costs currently.
- AI is seen as evolving, not destroying, jobs.
Paychex CEO John Gibson shared a positive outlook on the small business labor market in a recent interview. He indicated that while labor growth is solid, it has moderated from the previous year, with businesses prioritizing cost management. Gibson also addressed concerns about artificial intelligence, suggesting that technology evolves jobs rather than destroying them, and noted Paychex's clients, largely blue- and gray-collar workers, have less exposure to AI risks.
Despite a slight stock dip following earnings, Paychex's financial results met expectations, with management raising its full-year earnings forecast. The company's small business job index has remained stable throughout 2025, with wage inflation moderating. However, finding qualified employees continues to be a challenge, particularly for the smallest businesses.
Looking ahead to 2026, Gibson expressed optimism, citing potential clarity on tax policy and anticipated interest rate cuts from the Federal Reserve. He believes these factors will further support small business growth and economic stability, downplaying recessionary fears.
