Hiring and retaining employees is typically high on the minds of small business owners. In today’s job market, companies of all sizes compete for the best talent. Many small businesses successfully compete with the pay and benefits that larger companies can offer by offering a better work-life balance. However, especially in a tight labor market, smaller companies are often better positioned to offer their employees a range of attractive benefits, although they may not realize it.
As a small business owner, there are a variety of benefits you can add to your total employee benefits package, each with their own associated costs and benefits for your employees. When creating a unique benefits package that best suits your business, be sure to consider your budget and explore the most affordable options for your business.
Here are five benefits smaller employers can offer to hire and retain a talented workforce.
1. Health insurance: Health insurance is a great incentive for workers, and it’s often difficult to hire full-time staff if you don’t offer it. As a small business owner, you can use the Small Business Health Care Tax Credit as well as the SHOP Health Insurance Program or ACA Marketplaces to protect your employees. You can also consider new health insurance schemes, such as ICHRAs and QSEHRAs, that give your employees more flexibility.
2. Retirement: If you want to stand out as a company, you should consider offering retirement plans to your employees. There are a growing number of programs and tax credits that incentivize employers to provide retirement benefits, including some that are sponsored by state governments. For example, several states, including California, Illinois, Maryland, Oregon, and Colorado, have created state-sponsored retirement plans that provide small businesses with low-cost retirement benefits. Learn more about these types of programs here.
3. Paid leave: Paid leave is increasingly becoming a benefit provided by employers. Offering paid vacations allows you to broaden your pool of hiring talent, including non-traditional workers such as
4. Life and Disability Insurance: Life insurance and disability insurance may not be a common benefit offered by most small business owners, but they are in high demand in the job market. Life and disability insurance is particularly attractive to prospective employees if your business is at risk of accidents and hazards.
5. Personalized Benefits: There are several other benefits that you can offer your employees as needed to make your company a more attractive landing place. These benefits include overtime pay, financial wellness programs, and business-related commuting reimbursements.
After you’ve decided what benefits you want to offer your employees, the next step is to set up those plans. For certain benefits, such as paid leave, be sure to check if your state has an existing paid leave program, as 14 states currently do, including the District of Columbia. Simply contact your accountant, payroll company, or other trusted advisor and set up a fund with your budgeted amount to create your program.
Also, be sure to research the small business tax credits that are available at the federal level or in your state for providing certain benefits. For example, you may be eligible for a tax credit for certain types of paid vacations for eligible employees. Many states also offer tax credits for granting paid vacation or retirement benefits to your employees, allowing you to reimburse and fund your programs.
Offering the best services is a great way to attract the best talent. In addition to recruiting, benefits can also increase employee morale and reduce turnover.
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