Small businesses play a vital role in the United States economy, hiring millions of workers and driving innovation in numerous industries. However, small businesses and their owners face many challenges to both short-term and long-term success, some of which are unique.
Employee benefits are one example that cause headaches for business owners and their employees. Given the importance of benefits and workplace perks today, smaller employers cannot ignore emerging trends.
A new report from MetLife provides insights into the current state of employee benefits for small businesses and how these employers can improve their offerings.
EMPLOYEE BENEFITS FOR SMALL BUSINESSES
Earlier this year, MetLife released their 17th Annual U.S. Employee Benefit Trends Study which provides an in-depth look at employee benefits statistics.
And while the report encompassed employers of all sizes, MetLife recently released a smaller report that pulled out data and trends specific to small businesses.
To start, the report shows how important work-life balance – 86% of small business employees want to work for an employer that respects their work-life balance.
And it seems like employers are on the same page. When given the statement “when work and life blend and enrich each other, everybody wins,” employers and employees overwhelmingly agree:
- Small business employees – 75%
- Small businesses – 80%
This represents an opportunity for small business owners to stand out to job candidates and keep current employees happy.
RECRUITING AND RETENTION ARE A SIGNIFICANT CHALLENGE
Talent management is one business challenge that employers of all sizes share in common. However, small businesses often face greater difficulties due to their lack of resources.
The MetLife report says that 25% of small employers plan to hire new staff over the next year. However, 40% struggle to find high-quality candidates.
And with retention, small businesses risk losing their employees if they fail to offer the work experience and benefits expected today.
A rising trend for both job seekers and current employees is financial wellness and the role employers play; 50% of small business employees believe their employer has a responsibility for their financial wellness.
And for employers, there are reasons beyond just retention to focus on financial wellness. 29% percent of small business workers say they are less productive at work because of financial concerns and stress.
However, employee benefits can help employees overcome their financial concerns. Around 50% of employees say their benefits currently help to reduce financial stress, but this is much lower than the 66% of all employees.
THE VALUE OF EMPLOYEE BENEFITS FOR SMALL BUSINESS WORKERS
The MetLife study provides further insights into the employee benefits provided by small businesses. 52% of employees say they are satisfied with the benefits they currently receive, which is up 10% from last year’s results.
However, 67% of small employers believe their workforce is satisfied with the benefits offered.
And there’s data that shows why business owners should explore ways to improve their benefit offerings. 46% of small business employees said better benefits help them excel in today’s workplace (33% in 2018).
Benefits also play a role in why employees choose an employer – 46% of small business employees said benefits were an important factor in choosing their company.
The survey also shows tailored benefit offerings are extremely important. 64% of employees said that having customized benefits would increase their loyalty to their employer. And 88% of small business employees said that customized benefits are either a “must have” or “nice-to-have” offering.
Lastly, the survey explores how small business employees view voluntary benefits, a rapidly growing area for many employers. 52% of workers said they are interested voluntary benefits that they could choose from and pay for on their own.
SMALL BUSINESSES MUST EXPLORE WAYS TO ENHANCE BENEFITS IN A COMPETITIVE TALENT MARKET
Data continues to show how employee benefit usage and expectations continue to shift as employee demands change. Larger employers are often able to keep up with benefit trends to remain competitive for job seekers and retain their top workers.
Small businesses, however, can sometimes struggle with adding new benefits for a variety of reasons. However, exploring HR solutions such as a professional employer organization (PEO), can help business owners offer the same quality benefits as Fortune-500 companies!
As PEOs have grown in demand by business owners, so too have the number of myths that exist about them. But are they true? Our latest eBook explores 12 of the most common PEO myths and explains why they have been busted!