To combat high employee turnover, small businesses are taking steps to boost employee retention through benefits.
More than 163,000 U.S. businesses have closed since the beginning of the pandemic, according to the last Yelp Economic Average report. Over 1,000 small business owners revealed a 20% uptick in turnover rates over the past 12 months, according to a new survey from Principal Financial Group. Almost all believe the pandemic impacted the turnover.
Benefits are one way to recruit and retain top talent, yet small businesses often avoid offering employee benefits due to the cost. When considering employee benefits, small businesses rank affordability (50%) and their ability to attract and retain employees (42%) as most important, according to the Principal Financial Group survey.
“It’s encouraging to hear from so many business owners who are taking the time to better understand why their employees are leaving so they can proactively address these concerns for current and prospective workers,” Mark West, national vice president of business solutions for Principal, said in a release. “We’re committed to working with employers to ensure we have benefit offerings that are targeted to their employee needs, especially as they evolve in the wake of COVID-19.”
More than half of the small business owners served by Principal say they want to reward their key employees with more benefits. Seventy-four percent have a plan in place to add voluntary benefits and 59% plan to add qualified retirement plans, according to the Principal data.
Financial wellness benefits and HR and legal services are also in demand among small businesses. Seventy-three percent of small business owners are working with a financial professional to deal with the economic impact of the pandemic on their business, up from 54% from 2015, the Principal data found.
“Financial professionals and the advice they can offer will be critical given the significant new legislation and programs offered to businesses this past year as a result of the pandemic,” West said. “We’re seeing increased engagement from the businesses we serve via our business solutions team as employers navigate the economic impacts of COVID-19 along with relief programs rolled out to assist them.”
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