From a 401(k) plan to pet insurance for Fido, in today’s tight labor market, workers expect far more than just health insurance from their employers.
For small businesses, that’s been a problem.
There are more small companies and startups than ever before yet, because of their size, these firms have traditionally been at a disadvantage when it comes to benefit packages.
For starters, it’s costly, and managing benefits is exceptionally hard on small-business owners, who often wear many hats, according to John Scott, retirement savings director at Pew Charitable Trusts. “It’s a bandwidth issue,” he said.
Yet, for employees, these offerings are increasingly important, Scott said, especially as wages remain stagnant and younger workers, in particular, put more emphasis on finding a career with a flexible schedule and a better work-life balance.
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Thanks to a crew of fintech firms, including TriNet, Zenefits and Gusto, there is a way to bring big company benefits to small businesses.
Now, more employers are rethinking what they can do to recruit and keep top talent.
“We want to have a seat at the table,” said Ralph Clark, president and CEO of ShotSpotter, a gunshot-detection service used by law enforcement agencies.
ShotSpotter, based in California’s Silicon Valley, has just over 100 employees. “We lead with purpose and a lot of folks are attracted to our company,” Clark said. “But we know we have to be competitive.”
Clark hired benefits manager TriNet to enhance the company’s offerings. “We are not in a position to give everyone breakfast, lunch and dinner for free,” he said. “But our choice options are going to be right up there with Google.”
“We can provide the scale that large companies have so you can have a choice of benefits and things like a 401(k),” said TriNet CEO Burton Goldfield.
TriNet handles the bulk of what a human resources department would do — from payroll to benefits administration. (Generally, these providers charge a flat monthly rate per employee, although TriNet’s pricing depends on the types of benefits, the size of the company, the industry and other factors.)
For employees and their employers, that can make all the difference.
“Retention is so important,” Goldfield said.
“What I see in these startups, if they don’t find the right people early in their existence, they never make it,” he said. “It’s important that the core group is exceptional talent, and they retain that talent.”
In fact, the search for better workplace benefits is among the top three reasons why younger employees change jobs, according to data from LaSalle Network, a recruiting firm.
Job seekers are looking for positions with flexibility and generous amounts of time off in addition to paid parental leave, according to a separate poll of more than 1,500 working adults conducted in August by employee benefits provider Unum.
In TriNet’s own poll of about 3,000 adults in May, a whopping 91% of workers at small and medium-size businesses viewed non-traditional benefits, such as a flexible work schedule, commuter benefits, unlimited paid time off, paid volunteer time and remote work options, as an important part of their job satisfaction.
TriNet currently has about 16,000 clients ranging in size from five to 3,000 employees, according to Goldfield. Zenefits works with about 11,000 small and medium-size businesses, and Gusto serves more than 100,000, according to the company.