It might be hard to imagine, but recent data indicates the U.S.’s employment picture is improving, which Cramer said is good news for payroll processors ADP and Paychex.
Given the choice of either stock, though, he’d pick Paychex because it sports a juicy 4.3 percent dividend yield. With that kind of yield, Cramer said the stock is basically paying the investor to wait until hiring accelerates and the overall economy improves.
When compared to ADP , Paychex is also more levered to small businesses, which tend to do most of the new hiring. Eight-two percent of its clients have 19 employees or less, Cramer said. ADP tends to have larger clients.
Paychex is also 100 percent domestic, so it’s not bogged down by Europe’s debt crisis. ADP, on the other hand, gets 13 percent of its sales from Europe.
Both stocks trade at 18 times next year’s earnings with a 10 percent long-term growth rate, but Paychex pays a 4.3 percent dividend yield while ADP yields a 3.1 percent.