HOUSTON--(BUSINESS WIRE)--May 8, 2007--Nearly 86 percent of small business owners say their companies are either growing as predicted or at a faster pace than forecast at the beginning of the year, according to the results of a Business Confidence Survey released today by Administaff, a leading provider of human resources services for small and medium-sized businesses.

Most of the companies - 81 percent - said they were either positive or mostly positive about business conditions for the remainder of 2007, with 46 percent saying they plan to hire more new employees this year than they added in 2006. To fill positions, 52 percent said they are hiring full-time employees, while 16 percent said they planned to hire part-time workers.

Administaff also released compensation data compiled from its client base of more than 5,700 small and medium-sized businesses throughout the country. A comparison of first-quarter data against the same period in 2006 shows that average compensation is up 6.6 percent and average commissions have increased 9.8 percent. In addition, overtime pay is running 9.7 percent of regular pay.

"It's clear from the survey results and compensation data that owners of small and medium-sized businesses across the nation are upbeat about the current business climate despite the reported slowdown in economic growth that made the headlines recently," said Paul Sarvadi, Administaff's chairman and chief executive officer. "Their optimism is refreshing. It's the sort of confidence that fuels this country's economic engine and boosts employment."

Other highlights of the survey:

• 64 percent said overtime payments are likely to remain the same this year compared to 2006; only 11 percent expect to pay more overtime.
• Companies are filling gaps in their workforce from a combination of sources: 52.4 percent are hiring full-time employees; 41 percent make do with same staff; 24 percent rely on outsourcing; 18 percent pay overtime; 17 percent hire temporary employees; and 16 percent hire part-time employees.
• Only 13 percent plan to hire fewer employees this year compared to 2006.

Despite their positive outlook, employers are still grappling with a number of business challenges. Fifty-eight percent said the biggest issue they face this year is "hiring the right new employees," while 40 percent said the cost of medical coverage/insurance was a major concern. Other issues cited by respondents were as follows:

• Economic conditions
• Increased business competition
• Employee retention
• High cost of fuel
• Regulatory compliance
• Immigration issues

Most of the respondents expressed confidence in the current business climate. "Even though we are a little behind projections, we are moving forward with expansion plans by opening at least two new offices and hiring at least eight new associates during the year," said one business executive.

Another wrote: "We are looking forward to an outstanding year, which will ultimately elevate employee morale and reinforce company stability."

About the Business Confidence Survey

Respondents to the Administaff Business Confidence Survey are among the small and medium-sized companies Administaff serves throughout the country. The questions were designed to take the pulse of the small-business community and gauge the expectations of business owners through the remainder of 2007.

Administaff conducted the survey in late April over a three-day period. Researchers surveyed chief executive officers, chief financial officers and other executives in a variety of industries at its client companies across the United States. The overall sampling error is +/- 5 percent at the 95 percent confidence level.

Administaff is the nation's leading professional employer organization (PEO), serving as a full-service human resources department that provides small and medium-sized businesses with administrative relief, big-company benefits, reduced liabilities and a systematic way to improve productivity. The company operates 43 sales offices in 22 major markets. For additional information, visit Administaff's Web site at http://www.administaff.com.

The statements contained herein that are not historical facts are forward-looking statements within the meaning of the federal securities laws (Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934). You can identify such forward-looking statements by the words "expects," "intends," "plans," "projects," "believes," "estimates," "likely," "possibly," "probably," "goal," "objective," "target," "assume," "outlook," "guidance," "predicts," "appears," "indicator" and similar expressions. Forward-looking statements involve a number of risks and uncertainties. In the normal course of business, Administaff, Inc., in an effort to help keep our stockholders and the public informed about our operations, may from time to time issue such forward-looking statements, either orally or in writing. Generally, these statements relate to business plans or strategies, projected or anticipated benefits or other consequences of such plans or strategies, or projections involving anticipated revenues, earnings, unit growth, profit per worksite employee, pricing, operating expenses or other aspects of operating results. We base the forward-looking statements on our current expectations, estimates and projections. These statements are not guarantees of future performance and involve risks and uncertainties that we cannot predict. In addition, we have based many of these forward-looking statements on assumptions about future events that may prove to be inaccurate. Therefore, the actual results of the future events described in such forward-looking statements could differ materially from those stated in such forward-looking statements. Among the factors that could cause actual results to differ materially are: (i) changes in general economic conditions; (ii) regulatory and tax developments and possible adverse application of various federal, state and local regulations, including but not limited to the California State Unemployment Tax matter; (iii) changes in our direct costs and operating expenses including, but not limited to, increases in health insurance costs and workers' compensation rates and underlying claims trends, financial solvency of workers' compensation carriers and other insurers, state unemployment tax rates, liabilities for employee and client actions or payroll-related claims, changes in the costs of expanding into new markets, and failure to manage growth of our operations; (iv) the effectiveness of our sales and marketing efforts; (v) changes in the competitive environment in the PEO industry, including the entrance of new competitors and our ability to renew or replace client companies; (vi) our liability for worksite employee payroll and benefits costs; and (vii) an adverse final judgment or settlement of claims against Administaff. These factors are discussed in further detail in Administaff's filings with the U.S. Securities and Exchange Commission. Any of these factors, or a combination of such factors, could materially affect the results of our operations and whether forward-looking statements we make ultimately prove to be accurate.

CONTACT: Administaff, Inc.
Investor Relations Contact:
Douglas S. Sharp, 281-348-3232
Vice President, Finance
Chief Financial Officer and Treasurer
Douglas_Sharp@Administaff.com
or
News Media Contact:
Susan Emfinger, 281-348-3105
Director, Corporate Communications
Susan_Emfinger@Administaff.com

SOURCE: Administaff, Inc.