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Business total growing faster than employee total

LAWRENCEVILLE - Gwinnett County saw the number of business establishments grow at a greater rate than the number of employees from 2000 to 2005, a recently released report from the Atlanta Regional Commission indicated.

The report shows the number of establishments in the county grew by 18.5 percent over those five years, while the number of employees grew by 5.9 percent.

Other major metro Atlanta counties including Cobb, DeKalb and Fulton saw similar trends, and the 10-county region as a whole saw establishments increase by 10.3 percent and employees decrease by 2.3 percent.

This growth in the number of businesses was largely a result of a recession that started at the end of 2000, said Rajeev Dhawan, director of economic forecasting at Georgia State University.

Dhawan said a lot of people lost their jobs with larger companies during this time and ended up going into business for themselves.

"As the job growth came back, there was a lot more formation of small companies," Dhawan said.

Alfie Meek, Gwinnett County's economist, explained if three employees lost their jobs and got together to create a new business, the number of employees wouldn't change, but the number of establishments would. This was what was occurring on a large scale after the recession, Meek said, and added it is a phenomenon that won't be as noticeable now that the economy is healthy again.

"With respect to the future, I don't think you will see this dynamic - at least not as drastic - once data for the current period is released because the economy is growing, wages are rising and there are not as many job losses among large companies as there were in the 2000-2001 time frame," Meek said.

Gwinnett County led the 10-county Atlanta region in both the total number of businesses added (3,284) and the number of employees added (16,919).

Gwinnett had the smallest increase in payroll per employee, however, increasing just eight percent from $37,530 in 2000 to $40,540 in 2005. The 10-county region saw an increase in payroll per employee of 13.2 percent, jumping from in $38,505 in 2000 to $43,607 in 2005.