Small business owners are faced with difficult choices on a day-to-day basis, many of which center on balancing the number of employees they should hire and the benefits they provide to them. Healthcare plans, retirement plans and other benefits come with a high price – but they play an important role in the decision-making process for potential employees. Through the Q3 Spark Business℠ Barometer survey, it was found that only 24 percent of small business owners across the United States offer their employees a retirement plan or a 401(k). Business size is a significant factor in determining whether or not a small business contributes to retirement planning. While only 15 percent of small businesses with five employees or fewer offer retirement plans and 401(k)s to their employees, small businesses with more than 50 employees are nearly four times (58 percent) more likely to offer a retirement package to employees. Given the added expense that comes with offering retirement plans and 401(k)s, the survey asked small business owners why they make the effort. Nearly half (45 percent) say they feel a sense of obligation to help employees save for retirement, while 34 percent offer retirement support because it is an effective recruitment and retention tool. Small business owners are willing to invest in services that help both hire and keep the best employees, which can be a real difference-maker for a business of any size.
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*The Spark Business Barometer survey is Capital One’s survey of 400 small businesses across the United States was conducted by APCO Insight between 10/07/2014 – 10/17/2014. Small businesses are defined as for-profit organizations with less than $10 million in annual revenue. All interviews were conducted by telephone at their place of business using a computer-assisted telephone interviewing system. Sampling for this study was conducted using a national sample of businesses drawn from InfoUSA. Statistical weights were designed from the United States Department of Commerce to ensure proper inclusion of all SIC codes, employee size, and geography.
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