Debunking the Perception That Employers Cannot Afford Benefits

In the world of small business, the ability to offer employees benefits, particularly health insurance, has long been viewed as a benchmark of the company’s commitment to its employees and their well-being. However, most small business owners believe that the cost of these plans will be prohibitive to growing their business. Today we will look at why this perception exists and why it’s more often a myth than reality.

·         The Cost Conundrum:

o   The Perception: Employers, especially those in growing markets like Oklahoma City, OK, Norman, OK, and Moore, OK, perceive that offering benefits is financially unattainable due to high premiums and administrative costs.

o   Debunking the Myth: While it is true that providing benefits is an expense, studies have consistently shown that businesses offering comprehensive benefits enjoy higher employee retention rates, improved morale, and greater productivity, ultimately contributing to a healthier bottom line. In fact, a 2022 survey conducted by the Society for Human Resource Management found that 46% of organizations increased their overall employee benefits to remain competitive.

·         Misconceptions About Affordability:

o   The Perception: Many employers believe that only large corporations with substantial financial resources can afford to provide comprehensive benefits packages.

o   Debunking the Myth: While large corporations do have more financial leeway, businesses of all sizes can explore cost-effective strategies to provide benefits. From exploring different types of plan designs, to considering state subsidies or tax credits, numerous avenues exist for small employers to make benefits affordable for themselves and their employees.

·         The Burden of Administrative Complexity:

o   The Perception: Employers may shy away from offering benefits due to the perceived administrative burdens. From selecting an appropriate plan to managing enrollments and claims processing, it can feel overwhelming.

o   Debunking the Myth: If you are working with a broker who specializes in small business you shouldn’t feel this burden. Your broker should assist with paperwork, provide you with deductions for your payroll provider, and even help with employee education and plan selection.

·         The Competitive Edge

o   The Perception: Some employers may believe that benefits are an unnecessary expense, especially in industries where profit margins are tight, and competition is fierce.

o   Debunking the Myth: In reality, offering benefits can be a strategic differentiator, particularly when looking to attract and retain top talent. Employees are increasingly prioritizing benefits such as health insurance when evaluating job opportunities. By investing in employee well-being, employers can gain a competitive edge in recruiting and retaining a skilled workforce.

While the perception that employers cannot afford benefits due to cost persists, it is essential to recognize that this notion often stems from misconceptions. After all, investing in your employees isn’t just a cost, it’s an investment in the future success and sustainability of your business.