Small businesses can get a big benefit from offering their employees voluntary benefits. New research has found that 72 percent of employees said they would be more loyal to their company if they were offered benefits, even if they had to pay for those benefits themselves. Workers also said that financial education workshops would help increase loyalty.
Since small businesses often cannot offer much in the way of high salaries and raises, workers are looking to benefits to reach their financial goals. Overall, 50 percent of Generation X and Generation Y workers said they would want benefits to help them reach financial security. An additional 54 percent said they would be willing to pay for a wider array of benefits.
Not only were workers more likely to stay at a company because of benefits, but they were also more likely to be more focused on work as well because the offer of benefits would alleviate financial concerns. One in four respondents reported having to take time off during work to deal with financial issues.
"It’s hard to overestimate the importance of responding to the needs of younger workers on whose shoulders the future of a small business can depend," said Anthony Nugent, executive vice president of Group, Voluntary & Worksite Sales at MetLife, which conducted the research. "Our study underscores that generational differences about benefits needs and preferences are not just reflections of age. Younger workers, particularly those in many smaller organizations that were hit very hard by the recession, and who are unsure about the future of Social Security, have a different benefits perspective than older generations."
Employers appear to get the message, especially since the research found that 56 percent of workers at small businesses are Gen X and Y workers. Thirty- one percent of small businesses said that voluntary benefits were a key part of the benefits strategy of their company, up from 26 percent last year. That number jumped to 57 percent at larger firms, up from 43 percent a year earlier.
“There is no economic need for smaller businesses to leave popular voluntary benefits to the realm of larger companies, especially given the interest and willingness by many Gen X and Y employees to contribute to, or to fully pay for, benefits,” Nugent said. “With the newer enrollment systems and accompanying explanatory tools, it is now much easier to enroll employees with multiple benefits.”
The information in this research was based on the responses of 1,519 interviews with benefits decision-makers at companies and 1,412 interviews with full-time employees.