4 benefits solutions to help you elevate your small business

Help! That’s what many small business owners are looking for when it comes to finding and keeping the right employees. In a 2023 study, small business owners said recruitment and retention was one of the top problems they faced. That same study also revealed that 47% described hiring as either very difficult or somewhat difficult in the past year. 

In a May 2023 study by WEX, on a scale of 0 to 10, participants gave us a mean score of 9.11 when asked how important health benefits are to them when considering a job. Benefits can make a big difference for small businesses trying to field the best workforce. Keep reading this blog post to learn four reasons why offering benefits is challenging for small business owners and what they can do to overcome these challenges. 

Budget

The challenge: Offering the best benefits package is going to require a certain amount of budget. While benefits budget conversations are important for businesses of all sizes, budgeting can be of particular concern for small businesses, especially those that are new and growing. Nearly half of all new businesses fail in the first five years. 

The solution: Here are a few tips to help small business owners offer the best benefits when on a tight budget: 

• Prioritize the most-sought after benefits. Through employee outreach, such as a survey, determine what benefits your employees want most. 
• Focus on low-cost, high-impact options. Supporting your employees with benefits is a sign that you, as an employer, care about them. Identify benefits that can help many or most employees at a low price.
• Consolidate your benefits with a single administrator that offers bundled pricing.  

Want to discover what we learned after surveying our participants earlier this year? Check out the infographic below or click it to learn what participants had to say about the value of choice in their benefits. 

Customization

The challenge: If you do ask your employees what benefits they’d like, you also might get a wide variety of answers. Individuals are going to have different needs. Employees want choice but, as a small business owner, that can be tough to accommodate from a cost standpoint. 

The solution: In situations like this, try to identify what specific options or choices mean most to your employees. Health plan options (HSA-eligible health plans vs. traditional health plans) and savings/spending account options (HSA vs. FSA) were among the most common answers we heard from our participants in a May 2023 survey when we asked what was missing from their benefits. 

While customizing benefits can be difficult, you can focus on customizing the perks of your benefits. For example, if you offer a health savings account (HSA), you may have some employees who use the account to save money on immediate needs, while others are investing funds and/or building a balance for retirement. Choosing an administrator that has resources that cover all of these different needs will help you provide education that’s right for each of your HSA participants. 

Attract/retain talent

The challenge: Offering the best benefits is vital to attracting and retaining the best employees. One study found that 17% of employees who are considering leaving a job said that benefits were the number one reason why. These needs are heightened as the Great Resignation rolls on. While the term “Great Resignation” was popularized in 2021, more U.S. employees left their jobs in 2022 than 2021. One study found that it costs 33% of a person’s annual salary to replace them. 

The solution: As mentioned above, learning what benefits your employees want (via surveys or other engagement efforts) will help you retain your employees. And your benefits are just one way you can attract talent, especially if your budget is a challenge. 

• Employee benefits are often misunderstood, so increasingly communicating the perks of your benefits that are often overlooked might help current employees realize they’re supported in ways they didn’t even realize. 
• Offer non-financial benefits that are highly sought after. Among employees who are offered the opportunity to work remotely, 87% do so. And another survey found that 94% of employees want to work flexible schedules. These are just a couple ways you can differentiate yourself as an employer at no cost. 

Less-focused HR teams

The challenge: Offering more benefits can also be challenging if you lack dedicated legal, compliance, or HR resources to manage the regulatory responsibilities that come with each benefit, plus the time it takes to administer them and educate on them. 

The solution: One simple way to solve this is to find an administrator you can count on to handle the administrative needs for your benefits. Outsourcing your benefits administration comes with a number of perks, including saving time for your HR team and higher confidence in your ability to meet your regulatory requirements. An administrator that offers easy-to-use tools and helpful resources can also increase your participation rates, which will help you save and your employees save. 

Want to learn more about how you can support your employees? Check out our employee wellness guide below!

The information in this blog post is for educational purposes only. It is not legal or tax advice. For legal or tax advice, you should consult your own legal counsel, tax and investment advisers. 

WEX receives compensation from some of the merchants identified in its blog posts. By linking to these products, WEX is not endorsing these products.