Principal Business Owner Insights: See what your peers prioritize
Business owners remain confident and continue to value business protection, according to the latest Principal Business Owner Insights1 survey of 1,011 small- to medium-sized businesses. More of them now also see employee benefits as a key to their success.
This is our seventh such survey since 2008. Business owners responding in 2021, each with fewer than 500 employees, faced challenges in the last year. For instance, employee turnover has increased among 20% of the businesses, compared to 15% two years ago and 11% in 2015.
Principal Business Owner Insights most of all helps pinpoint business planning opportunities, especially the gaps between owners’ priorities and their plans. Consider these as benchmarks to help frame your own business decisions.
Check out the full Business Owner Insights report (PDF).
How do your business priorities compare?
We asked business owners to rank their priorities, and share whether they have a plan in place. Here are their five highest priorities.
1. Business protection
Business owners have chosen this as their No. 1 priority in six consecutive surveys, yet only half have a plan—an uptick compared to 46% in 2019.
2. Health and wellness solutions
Sixty percent offer comprehensive health insurance, down from 78% two years ago. For the first time we also asked about employee assistance programs (EAP); 33% offer one.
3. Income protection
It's been a top priority since 2010, yet less than half have a plan.
4. Business succession planning
Succession plans need to be regularly updated. Of those with a plan, 32% haven't reviewed it in more than two years.
5. Qualified retirement plans
401(k) plans remain the most popular (57%). Employee stock ownership plans (ESOPs) surged from 7% to 17% in the last two years.
Business Owner Insights key findings
Business owner protection still reigns.
This protection seems like an imperative, considering it’s the top choice in all but one of our biennial surveys. Yet it’s also one of the largest opportunities, with half of owners yet to enact a plan.
Learn more: Business protection
There’s more confidence about changing the model than selling the business.
For the first time we asked business owners whether they were confident about changing their business model to “adjust to shifting demands.” Yes, 72% said. However, only 31% are confident about selling their business.
Learn more: Business succession planning in six steps
Benefits help attract and retain.
Business owners say the top two goals of offering an employee benefits package are affordability (50%) and the ability to attract and retain employees (42%). A larger share (58%) now say employee benefits also help improve workforce productivity.
Learn more: Use the Principal® Benefit Design Tool to see what other organizations of your size, industry, and region offer their employees.
Key employees are on the rise.
The number of businesses with four or more key employees has grown from 21% to 35% throughout the history of the survey. More than half of business owners (55%) would like to reward these key employees with additional benefits.
Learn more: Key employee retention and retirement solutions
1 The 2021 Principal Business Owner Insights survey is based on 1,011 online interviews conducted in January 2021 by Dynata.
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