Small businesses are the backbone of the American economy. They create two out of three jobs in the United States, accounting for half of all private sector employment. For these businesses to continue to thrive, they must retain their employees. Unfortunately, it can be challenging for small ventures to go toe-to-toe with established multinational corporations with many more.
Studies show that small businesses have a high turnover rate, with the average worker staying at a job for under four years. The most common reason for leaving a position is “seeking greener pastures,” which usually refers to earning more money. Other popular reasons include poor treatment from management, a toxic work environment, and a lack of career growth opportunities.
There are several reasons why employee retention is essential for small businesses:
- It can be costly to replace an employee. It can cost up to six months’ salary to find and train a new employee.
- When employees are happy, they are more productive. A study by CareerBuilder found that unhappy employees are less effective and more likely to leave their jobs.
- Employees leaving a small business can hurt the company’s reputation.
It will be necessary to find ways to make your business more attractive to encourage employees to stay, making these incentives essential to your efforts.
Health Insurance
Health insurance will always be the primary reason employees stay with a company, even more so than the salary itself. This situation is because the government does not provide health insurance in the US. The Patient Protection and Affordable Care Act (PPACA) has made it easier for small businesses to offer health insurance to their employees.
The act requires companies with fifty or more full-time equivalent employees to provide health insurance or face a tax penalty. For smaller businesses, the PPACA offers tax credits of up to 50% of premiums to help offset the cost of insuring employees. Insurance exchanges have also been created, which provide small businesses with a way to compare and purchase health insurance plans.
If you do not have the resources for health insurance, you can look into joining a health insurance buying group. These groups allow small businesses to pool their resources and purchase insurance at a lower cost. You can also look into providing a stipend for your employees to use to purchase their health care plans.
Dental Insurance
Many more employers are now offering dental insurance as an employee benefit. Dental health is essential; without insurance, it can be pretty costly. According to the National Association of Dental Plans, the average annual cost of dental care in the United States is over $1,000.
There are many reasons why you should offer dental insurance as a benefit to your employees:
- It will help attract and retain employees.
- It will improve the oral health of your workforce, which will lead to fewer missed workdays due to dental problems.
- It will save you money in the long run because healthy employees have lower healthcare costs overall.
You can purchase a stand-alone dental insurance plan or add dental coverage to your existing health insurance plan.
However, getting dental insurance on a health insurance policy could be costly. You may want to look into a dental discount plan instead. These plans are not insurance, but they provide discounts of up to 60% on dental procedures. You can partner with a reliable dentist to help you get discounted deals with high-quality dental care.
Childcare Assistance
Many employees cannot handle the responsibilities of established corporations when they have to take care of their children. Because of this, some small businesses are now offering assistance with childcare as an employee benefit.
If you offer this benefit, you will be able to attract and retain employees who might otherwise leave your company to find a position that provides this type of assistance. Childcare assistance can also help your employees become more productive because they will not have to worry about their children while they are working.
There are many ways to provide this benefit to your employees. You can offer on-site childcare, which can be expensive but is the most convenient option for parents. You can also provide subsidies to employees at a daycare center or in-home caregivers. Finally, you can offer flexible work hours so that employees can better coordinate their work and childcare schedules.
Final Thoughts
Offering employee benefits is a great way to attract and retain employees, especially in small businesses. Health insurance, dental insurance, and childcare assistance are some of the most popular benefits employees look for in a company they want to consider a second home. Offering these benefits can improve your workforce and save money in the long run.
