A worksite benefits carrier says 62% of small business executives are finding it harder than they did a year ago to offer attractive employee benefits.
Aflac’s recent study of more than 500 small business executives found that companies that saw revenues fall over the past year are particularly pressured to reduce insurance costs, cut back on employee benefits and slash wages.
According to the study, 69% of businesses with reduced revenues are finding it more difficult to offer strong benefits packages, compared with 56% of companies whose revenues stayed the same.
“Employers are concerned about losing employees to competitors with better benefits packages, even while they may be struggling to reduce costs and make ends meet,” said Paul S. Amos II, president and chief operating officer of Aflac Inc., Columbus, Ga.
Of small business decision-makers, 43% say they are more likely to cut back on employee benefits, and 65% reported they are looking more aggressively for ways to reduce insurance costs.
Among small businesses with 50 to 99 employees, 71% are looking harder for ways to reduce insurance costs, compared to 56% of companies with 10 or fewer employees that said the same thing, Aflac reports.
Of those surveyed, 43% report that they are more interested in voluntary and supplemental insurance benefits today than they were a year ago.
Anxiety among their employees is also on the rise, another Aflac survey found. According to that poll, 52% of workers are more worried than they were a year ago about out-of-pocket medical expenses, and 56% say an illness or injury would be a greater concern today than it would have been a year ago.