Latest news with #Tremper
Axios
08-07-2025
- Business
- Axios
Middle managers fade as AI rises
The above chart may explain why your boss is taking longer to get back to you lately: She's got a lot more underlings to watch over. Driving the news: People managers now oversee about twice as many workers as just five years ago, per a new analysis. Why it matters: Middle managers — i.e. bosses who have bosses — were already quietly going extinct, and now AI may be hastening the process. By the numbers: There are now nearly six individual contributors per manager at the 8,500 small businesses analyzed in a report by Gusto, which handles payroll for small and medium-sized employers. That's up from a little over three in 2019. "It's happening broadly across the economy," Nich Tremper, a senior economist at Gusto, told Axios. For small companies, a lot of this happened through attrition, he says. "Rather than replacing a manager, an existing one will just see an expanded scope." (Pity these folks during performance review season.) The big picture: Big tech has been shedding middle managers for the past few years, a process that's been dubbed the Great Flattening. It's not totally clear that AI is replacing the work managers do. Instead, the headcount reduction seems to be a way to cut costs, particularly as companies spend huge sums on AI. Zoom in: Reducing management layers is one of Microsoft's stated goals in laying off thousands of workers this year as it ramps up its AI strategy. Most recently the company announced it was shedding 9,000 employees — a mix of individual contributors and managers. Amazon CEO Andy Jassy announced an effort to reduce managers in a memo last year. Google cut the number of vice president and manager roles by 10% last year, according to reporting from Business Insider. And Meta has been "flattening" since 2023's "year of efficiency." State of play: Small businesses in the service sector — including restaurants and other hospitality businesses — were first to this trend, says Tremper. These companies needed to find a way to cut labor costs, as wages soared coming out of the pandemic and interest rates spiked, too. Between the lines: AI may allow for more flattening to come. The use of the technology has freed up managers' time, as their direct reports turn to AI for help instead of their manager, per a recent study highlighted in this month's Harvard Business Review. Meanwhile, supervisors are also increasingly using AI to automate managing, as Axios' Megan Morrone reported earlier this month, though it's not exactly clear how. What to watch: "Flattening" can backfire. Gusto found that industries with more managers had higher worker productivity. Junior employees especially need the training and mentorship that a close relationship with a manager offers, Tremper says.
Business Insider
23-05-2025
- Business
- Business Insider
The share of businesses started by women kept rising while the funding gap was stubborn
Women-owned startups made up 49% of all new businesses in 2024, up from 29% in 2019 and the highest share recorded in the past six years, per a new report from Gusto. The HR and payroll platform surveyed its users and also found that AAPI, Black, and young women were driving this trend. Despite the risks and barriers that women face in starting their own businesses, many are choosing entrepreneurship because of the independence and autonomy it can offer, said Nich Tremper, senior economist at Gusto. "It's seeing a shift from this necessity entrepreneurship to this opportunity entrepreneurship," said Tremper, referencing a change he saw in 2022. "So we've seen women go from saying, 'I need to start a business to make ends meet, to take care of my kids,' to, 'I want to start a business because of the benefits that it provides.'" Even with the growth of women-owned businesses, barriers still exist for women seeking investments to start or scale their startups. As a result, many rely on financing from their personal networks and debt to launch their enterprises. Women of color are driving entrepreneurship Tremper said the growth of new businesses is driven by women of color who are seeking more independence and ownership of their work. Fifty-four percent of all new AAPI- and Black-owned businesses were started by women, compared to 46% that were started by their male colleagues, per Gusto. Social justice movements like Black Lives Matter and Stop AAPI Hate bolstered support for businesses owned by women of color, per a report published earlier this year by Wells Fargo. Tremper added that Black and AAPI women-owned businesses gained more momentum during the pandemic. Meanwhile, Hispanic women made up 43% of new business owners compared to 56% of Hispanic men. Gusto reported that the disparity was because women-owned businesses are focused on the community and personal services sectors, while almost half of all Hispanic-owned businesses are concentrated in goods production like home remodeling or construction. Men started nearly 70% of businesses in that sector. Younger generations of women are also reaching gender parity: More than half of the businesses created by millennials and Gen Zers were women-owned. On the other end of the spectrum, male baby boomers made up 64% of new business owners compared to 36% of boomer women. Although it's typical for people to launch businesses in their mid- to late 30s and early 40s — after they've developed an expertise in a particular field — that trend has been changing, Tremper said. "As women are increasingly a large share of the labor market over the last several years, millennial and Gen Z women are really starting businesses at higher levels," Tremper added. The equity gap in business financing Women-owned businesses earn a higher return at $0.78 for every dollar invested compared to men's $0.31, Tremper said. Additionally, women-owned businesses have seen faster revenue and employment growth in the past five years compared to businesses started by men, per Wells Fargo. However, Tremper said there's a persistent gender gap between equity financing for women and men. "The women who do receive this equity financing really outperform men, but they're still getting it at a lower rate," Tremper said. Women who apply for private investments are 75% less likely to receive equity funding than their male peers, per Gusto. Gusto's research found that women largely relied on their social networks and accruing personal debt to finance their new businesses. It was more common for women to also secure private loans through collateral in their homes or vehicles, which can expose them to more financial risks. That means that the stakes can be higher for women-owned businesses—if the founders fail, their personal finances could take a hit. Despite these challenges and barriers, women-owned businesses are resilient and continuing to find success in the market, Tremper said. "We're seeing these women-owned businesses coming into the economy and sticking around," he added. "They're keeping their course, they're active players in the economy."
Business Insider
23-05-2025
- Business
- Business Insider
The share of businesses started by women kept rising while the funding gap was stubborn
Younger women and women of color are starting more small businesses than men. Women-owned startups made up 49% of all new businesses in 2024, up from 29% in 2019 and the highest share recorded in the past six years, per a new report from Gusto. The HR and payroll platform surveyed its users and also found that AAPI, Black, and young women were driving this trend. Despite the risks and barriers that women face in starting their own businesses, many are choosing entrepreneurship because of the independence and autonomy it can offer, said Nich Tremper, senior economist at Gusto. "It's seeing a shift from this necessity entrepreneurship to this opportunity entrepreneurship," said Tremper, referencing a change he saw in 2022. "So we've seen women go from saying, 'I need to start a business to make ends meet, to take care of my kids,' to, 'I want to start a business because of the benefits that it provides.'" Even with the growth of women-owned businesses, barriers still exist for women seeking investments to start or scale their startups. As a result, many rely on financing from their personal networks and debt to launch their enterprises. Women of color are driving entrepreneurship Tremper said the growth of new businesses is driven by women of color who are seeking more independence and ownership of their work. Fifty-four percent of all new AAPI- and Black-owned businesses were started by women, compared to 46% that were started by their male colleagues, per Gusto. Social justice movements like Black Lives Matter and Stop AAPI Hate bolstered support for businesses owned by women of color, per a report published earlier this year by Wells Fargo. Tremper added that Black and AAPI women-owned businesses gained more momentum during the pandemic. Meanwhile, Hispanic women made up 43% of new business owners compared to 56% of Hispanic men. Gusto reported that the disparity was because women-owned businesses are focused on the community and personal services sectors, while almost half of all Hispanic-owned businesses are concentrated in goods production like home remodeling or construction. Men started nearly 70% of businesses in that sector. Younger generations of women are also reaching gender parity: More than half of the businesses created by millennials and Gen Zers were women-owned. On the other end of the spectrum, male baby boomers made up 64% of new business owners compared to 36% of boomer women. Although it's typical for people to launch businesses in their mid- to late 30s and early 40s — after they've developed an expertise in a particular field — that trend has been changing, Tremper said. "As women are increasingly a large share of the labor market over the last several years, millennial and Gen Z women are really starting businesses at higher levels," Tremper added. The equity gap in business financing Women-owned businesses earn a higher return at $0.78 for every dollar invested compared to men's $0.31, Tremper said. Additionally, women-owned businesses have seen faster revenue and employment growth in the past five years compared to businesses started by men, per Wells Fargo. However, Tremper said there's a persistent gender gap between equity financing for women and men. "The women who do receive this equity financing really outperform men, but they're still getting it at a lower rate," Tremper said. Women who apply for private investments are 75% less likely to receive equity funding than their male peers, per Gusto. Gusto's research found that women largely relied on their social networks and accruing personal debt to finance their new businesses. It was more common for women to also secure private loans through collateral in their homes or vehicles, which can expose them to more financial risks. That means that the stakes can be higher for women-owned businesses—if the founders fail, their personal finances could take a hit. Despite these challenges and barriers, women-owned businesses are resilient and continuing to find success in the market, Tremper said. "We're seeing these women-owned businesses coming into the economy and sticking around," he added. "They're keeping their course, they're active players in the economy."
