Small business insurance and employee retention

Even though Washington finally increased the debt-ceiling and averted a default, it has done nothing to solve the problem of creating new jobs. In fact, taking the shutdown of the FAA as an example, it has actually been throwing more people out of work. Put simply, Washington politicians play politics with jobs. At both the federal and state levels, the conventional wisdom is that we can always grow our way out of any economic problem.

Accepting the sad reality of the recession and the very slow recovery, politicians are full of optimism. All we need do is sit back and wait for business to pick up. Once the level of trade increases, hiring will begin and everything will be back to how it was quicker than you can say, John Maynard Keynes.

In particular, politicians and their tame economists who favor the current capitalist system, point to the small business sector. They all proudly proclaim this is the future hope of humanity. This is the place where innovation burns most brightly, where the entrepreneurial spirit is strongest and where upward mobility is most likely to happen. These are the flexible owners with nimble feet to take advantage of every new opportunity as it comes along, hiring new staff in an instant once the additional business is proved real. Except, not only does the evidence show small businesses have been struggling more than big businesses — lack of funds affects small businesses more quickly and bank lending has been severely cut back — but they are also finding it more difficult to retain staff, let alone hire new ones. Surveys carried out used to find high levels of employee loyalty. But over the last two years, the same surveys are showing less than 50% of employees admitting loyalty and some 35% actively looking for different work.

The key factor is the benefits package with particular emphasis on health and dental cover. All companies tend to focus on cutting costs and increasing their productivity, but all this comes to nothing if key employees leave. The latest guidance from those advising small businesses is to review all aspects of the work environment and the benefits package to maximize employee retention. Although healthcare is a major headache for small businesses right now, this is not a reason for delaying a review of the current package. It’s also been shown good politics to help with retirement planning. Even though the employees will have to absorb some of the costs, it is good to talk about life insurance and saving for retirement. In other words, employees are more likely to stay loyal and give of their best if they have peace of mind.

So walk through the workplace and make a list of all the things that could be done to make the environment safer and more attractive. Morale is improved if you are seen to be thinking about your employees’ physical needs. Then you should sit down with your agent or broker and see whether there are small business insurance packages that will improve employee retention. Even if employees are absorbing some of the cost of enhanced health benefits, they can still be happier and more productive. Ensure your business insurances planning looks after your employees’ financial health.

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