US Small Businesses Not Motivated to Offer Worker Retirement Plans
Research recently published by the Employee Benefit Research Institute (EBRI), the Center for Retirement Research at Boston College, and Greenwald Research has found that, past more profits, no single reason will lead more U.S. small businesses to offer retirement plans to their workers.
The report, Small Business Retirement Survey: Policy Knowledge and Reasons for Offering or Not Offering a Retirement Plan, also found that many small businesses surveyed (defined as having less than 100 employees) had no experience working with an outside organization for payroll or administering other benefits, which the researchers said could lower a company’s ability to actually offer a retirement plan.
Of the small businesses not offering a plan, being either too new or too small was the most cited reason for not doing so, at 26%, leading researchers to conclude that no one reason would move more small business to extend retirement benefits to employees.
On the contrary, of those employers that do offer retirement benefits, nine out of 10 said they offer a plan because of its positive effect on employee attitude and performance. Equally, 90% said having a plan in place gave their business a competitive advantage in employee recruitment and retention.
However, among the small business owners not offering a plan, 72% were not aware of the availability of tax credits up to US$5,000 to cover the costs of starting a retirement plan, and 78% said such tax credits would at least make offering a plan more attractive.
Click here to learn more key findings from the report.