December 23, 2019
By Mary Miller
Contributing Editor, Main Street Monday
Main Street Monday – Principal Financial Well-Being Index Projects Changes to Employment Benefits in 2020
According to the Principal Financial Well-Being Index, 6 out of 10 small businesses are predicted to experience growth throughout 2020. This trend continues a pattern of year-over-year growth and financial improvement that nearly 30% of small business employers have reported seeing over the past six years. However, the rising costs of healthcare and benefits is expected to continue to impact main street.
Challenges for Main Street
Despite high optimism levels, Principal projects that main street will continue to face some challenges. The Index reports:
- 76% of entrepreneurs claim the rising cost of healthcare and growing revenues in highly competitive U.S. markets are the top challenges for their businesses.
- 72% indicate that offering competitive benefit packages is challenging.<
- 67% of small business owners state it is hard to find and retain qualified employees.
- 30% of millennial business owners indicate they are more likely to increase budgets to pay for staff perks and benefits compared to only 14% of baby boomers.
- Baby boomer small business owners may offer fewer perks and benefits due to cost, but 68% focus on increased employee satisfaction and morale, and 53% focus more on ethics and team spirit/responsibility for the company.
While 45% of employers are projected to implemented budget cuts to accommodate rising healthcare costs, the overall trend is to offer more creative perks to retain staff. Throughout 2020, expect to see more employers offering flexible work schedules, no dress codes and free food as incentives to attract and retain employees.