Small business owners are focusing on culture and morale, retaining and attracting talent, and employee wellbeing, says new study from Lincoln Financial Group
The last two years have had an impact on businesses of all sizes, and small businesses are no exception — in fact, nearly all small business owners surveyed (93%) have re-evaluated their strategy and plan to make changes to their business due to COVID-19, according to a new Small Business Owner Survey from Lincoln Financial Group (NYSE: LNC). For more than 80% of small business owners, employee benefits are a top strategic priority, as these benefits play a critical role in impacting culture and morale, employee wellbeing, and attracting and retaining top talent.
The pandemic and its resulting changes have prompted small business owners to reevaluate the benefit packages they offer, with more than half of small business owners surveyed saying COVID-19 was influential in their decision-making process. More than a quarter (28%) of small business owners reported offering better benefits to attract and retain talent as a result of the pandemic: 30% are adding life insurance, 27% adding a retirement matching contribution, financial wellness program and/or retirement account, and more than 25% adding accident, critical illness, hospital indemnity, vision and/or dental insurance.
“Small business owners understand just how critical a robust benefits package is for attracting and retaining top talent in today’s competitive market,” said Ralph Ferraro, senior vice president, Workplace Solutions Product and Underwriting, Lincoln Financial Group. “And they are looking to benefit providers to offer innovative, simple solutions that meet their employees’ needs and make it easier for owners to focus on running their day-to-day business.”
Removing barriers facing small business owners
An increase in the strategic priority of employee benefits, raises concerns for small business owners on choosing the ones that best suit their needs, ranging from weighing the costs and benefits of plans (51%) to administrative concerns (28%). However, nearly three-quarters (72%) say multi-employer benefits solutions are appealing (for cost-saving, access to more benefits and ease of use), so solutions like Pooled Employer Plans (PEPs) could help, as these products are aimed at helping small businesses offer a robust retirement plan with fewer administrative and fiduciary responsibilities than a traditional plan.
Small business owners look to financial professionals for guidance
While many small business owners consult financial professionals on business growth and strategy (58%), far fewer discuss business succession (31%) and protecting against the loss of key people (22%), though both can be addressed through products such as life insurance. As nearly two-thirds of small business owners discuss their business with their financial professional at least quarterly (64%), there’s an opportunity to address these gaps.
“From protecting an owner’s family against issues that arise from an unexpected critical illness or premature death to providing security should a business lose an essential employee, life insurance products can help small business owners mitigate significant business risks, protecting both personal and professional interests,” said Andy Bucklee, senior vice president, Life and Executive Benefits distribution.
For more information, visit www.lfg.com.
Lincoln Financial, Small Business Owner Survey, November 2021
The goal of this research is to understand U.S. Small Business Owner perspectives on a variety of topics including top concerns, offering employee benefits, financial advice, and the impact of COVID. Responses were gathered from 11/8/2021 – 11/21/2021 using the Qualtrics survey platform. For the purpose of this study, Small Business Owners were defined as currently owning a business with 10-100 employees and revenue between $250,000 – $10 Million. The small business was required to operational for at least two years and privately owned/non-government. Responses were collected from a total of 313 individuals who own small businesses in the U.S., including 125 women and 120 multicultural small business owners (76 Hispanic, 33 Black/African-American, 12 American Indian/Alaska Native, 8 Asian American, 7 other race). Respondents were sourced from a third-party panel provider targeting individuals owning small businesses in the United States.
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