Vincent Colicchio: Yes. Gary, curious, you had mentioned that you’re starting to see hiring slow in the client base. What is the trend you’re seeing in wage inflation? Is that also coming in?
Gary Kramer: Wage inflation slowed down a little bit, but it’s still there. And we’re still going to have — as we think of ’23, we’re still going to have a tailwind to growth for which inflation just for think of folks that got raises sometime in the midpoint of the year of ’22. We’re going to be realizing that in ’23 over a softer comp. So we feel like we got a little bit of a tailwind for wage inflation, and we feel like client hiring is going to slow in ’23 compared to ’22 just because of the macroeconomic conditions.
Vincent Colicchio: I forget when you started targeting larger clients, but have you seen the average size of new clients? You already mentioned the average size of new clients is the ones you’re losing are small, the ones you’re gaining. I’m just curious if that average size of new clients is growing over time?
Gary Kramer: I would say, our average size is holding pretty consistent now over the last 4 quarters. But it is quite a spread of — if you went back and looked at ’18 and prior for clients we were adding. It’s like a — compared to pre-pandemic, I’d say it took us 2 clients to add pre-pandemic to equal one of the clients we add now.
Vincent Colicchio: Okay. And are you finding it easier to — I know you had struggled to attract leaders for the asset-light groups. Is that getting easier — and how does that affect your calculus and how many groups you launched in ’23?
Gary Kramer: So we launched Class 1 in the beginning of ’22, and that class did very well. They added about — in the year they added, I think it was about 22 clients and 250-ish WSEs. Since then, we launched Class II and Class III, that was really at the back end of ’22, where they were selling in December or January into ’23. We had a challenging time finding folks, I would say, until after the summer of ’22. But I can tell you we’ve got a really good class of folks that are in there now. We are going to start to look to higher again in Q2 with the idea of hiring Q2, train in Q3, so they can sell in Q4.
Vincent Colicchio: Okay. And last one for me. What is your thinking about M&A? Will you become proactive if, in fact, valuations come in ’23. And are they coming in? I’ll say the market has slowed some with the rising of rates, interest rates. We’re starting to see more action in ’23 than we did in the back half of ’22, as far as SIMS come across the desk, our company is getting ready to get come out. I can tell you that the valuations we’re seeing are getting to more realistic levels than where they were in, say, ’21 when things were a little frothy. But we are still — we still are active in of the market. And if we see something that fits well, good people, good product, good company, we would pull the trigger.
Operator: . We’ll take a next question from the line of Marc Riddick with Sidoti.
Marc Riddick: I wanted to touch a little bit on the guide content. Actually, I wanted because a lot of my questions already answered, but I was curious about the tax rate that was mentioned. It maybe was a little too kinder than maybe I was expecting. Is that a function of a geographic revenue mix? Or is there something else taking place there with the tax rate?
