Principal® SMB Insights

While many businesses say things are looking up, the environment still presents challenges.

Positive sentiment has increased.
However, while SMB customers say their business health isn’t as stable as it’s been, those with 60 or more employees are not as impacted by the changing environment. Non-customers added that they’re frustrated with lack of viable employee talent and not being able to expand without additional help.

Recruiting and retention are the top issues. 
SMB customers say they’re getting ready to increase salaries or have raised them in the last month. Non-customers are less focused on hiring (43%) due to maintaining cash flow, and more focused on retention (85%)—and the top ways they’ll do it is to increase salaries/offer competitive salaries, make employees feel valued, and offer a better work/life balance. Employees also think raising salaries would help, and they add that employees are looking for new jobs more than employers think. In addition, almost half of employees (48%) remain concerned about long-term remote work issues. While many employers are planning to increase salaries, you can also talk to them about offering key benefits to help recruit and retain talent.

Employee mental health remains a concern.
SMB customers list the top reasons for worsening mental health as anxiety/stress, negative news in the media, and fear of the unknown. Employees cited the same reasons and also mention concern about their own financial situations. Employees also said there’s still a gap between what employers are doing and what employees are seeing. Over three in 10 employees still say their business isn’t doing anything to improve mental health. And almost 1 in 5 SMBs acknowledge they aren’t doing enough. SMB customers think allowing flexible work hours and encouraging a better work life balance would best impact employee mental health. Share our Taking care of employees and communities website for tips on communicating with their employees, supporting their overall well-being, and more.

SMBs offering an Employee Assistance Program (EAP) observe low use.
Of the 57% of SMB customers offering an EAP, 28% say employees don’t use the EAP because of the stigma. In addition, almost a quarter of employees surveyed don’t know if their employer offers an EAP or not, and some say they’re not using it because of the stigma as SMBs indicated. If you have clients who offer or plan to offer an EAP, share these tips to help them realize all the well-being resources they can access and promote to employees.

Non-customers want to add benefits.
Over half (57%) of non-customers are interested in adding employee benefits within the year, with mental health and retirement benefits as their top two priorities. And 71% say they worry more about not being able to afford the same benefits as larger SMBs. Of the employees surveyed, 69% say they want their employers to add more benefits—and their most desired benefits are Paid Family and Medical Leave and retirement benefits followed by key employee benefits and life insurance. Use the Principal Benefit Design Tool to help employers compare benefits for group dental, long-term disability, short-term disability, life insurance, and retirement against benefits being offered by similarly sized organizations in their region and industry.