Small businesses gain competitive edge from family-friendly benefits, report finds

HR Dive | Smaller firms increasingly offer health coverage, parental leave and flexible work options, according to The Best Place for Working Parents.

Dive Brief:

  • Small businesses that offer benefits such as health coverage, parental leave and flexible work options see improvements in several employee metrics, including productivity, motivation, satisfaction and health, according to a report last month from The Best Place for Working Parents.
  • The public-private partnership’s analysis of 49 U.S. employers found, for example, that employers offering health coverage increased their likelihood of having high-performing employees by four times. Those that offered maternity leave, meanwhile, were more than 50 times more likely to have high performers.
  • Noncore benefits offerings had positive effects as well, per the report. Remote work options increased employee motivation and health and increased employee satisfaction with personal relationships. Paid time off and child care assistance led to similar results, with PTO increasing personal relationship satisfaction by more than 16 times.

Dive Insight:

The findings echo what other researchers have observed so far this year, which is that family-friendly benefits are a consistent focus for employers even as interest in other offerings declines.

For example, virtual women’s and family health vendor Maven found that 63% of HR professionals said their organizations planned to increase family health benefits in the near future, with 87% stating that such benefits were “extremely important” to both current and prospective employees.

But maintaining expansive benefits packages has traditionally been a challenge for small businesses. A 2018 survey of small business owners found that 28% reported being unable to fill skilled positions because they could not compete with the pay and benefits offered by large corporations.

In a press release accompanying the report, Sadie Funk, national director of The Best Place for Working Parents, said small businesses increasingly offer family-friendly benefits, a significant trend given that they account for the majority of firms in the U.S. and employ nearly half of the country’s workforce.

“We know that there is not a one-size-fits-all solution to family-friendly workplaces, but we’re hopeful this report will help small businesses see the possibilities of implementing family-friendly policies to support their employee’s needs and drive their business goals,” Funk said.

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