While small and midsize businesses (SMBs) remain positive about the health of their business, they have increased negative feelings about economic uncertainty and workforce challenges. Employees have the same concerns, but don’t see eye to eye in other areas.
The Principal SMB Sentiment
The latest findings from the August 2024 survey.
Data shows
The most important SMB issues:
- 97% Staying in business
- 95% Keeping existing customers
- 94% Customer experience
- 94% Retaining key employees
The most anticipated changes in the next six months:
- 40% More focus on customer experience
- 34% Become more agile/adaptable
- 33% Add new products/services
| Impact of inflation |
|---|
| Business growth has been impacted (85%) |
|
Business has made/is making changes (84%) |
| Business does not have enough capital on hand (36%) |
Data shows
All employee generations say inflation and the rising cost of living contribute to worsening employee mental health.
- 100% Boomer
- 94% Gen X
- 84% Gen Z/Millennial
A flexible work arrangement is the No. 1 mental health benefit employees want most.
Employees say:
- Offering flexibility is more important than ever (92%).
- A flexible work schedule could help improve mental health (89%).
- Flexibility is important to employee loyalty and retention (86%).
| Reasons for worsening employee mental health | ||
|---|---|---|
| Ranking | SMB top reasons | Employee top reasons |
| 1 | Inflation/rising cost of living (85%) | Inflation/rising cost of living (90%) |
| 2 | Concern about their financial situation (84%) | Concern about their financial situation (87%) |
| 3 | Anxiety/stress/depression (80%) Excessive workload/too much to do (80%) |
Excessive workload/too much to do (83%) Lack of pay raises/bonuses (83%) |
| 4 | Employees working too many hours (74%) | Anxiety/stress/depression (81%) |
| 5 | Lack of pay raises/bonuses (73%) | Employees working too many hours (75%) Not having the right/enough benefits (75%) Increasing consumer debt levels (75%) |
Data shows
In the next 12 months:
- 72% of SMBs want to add benefits.
- 83% of employees want their employer to add benefits.
Both employees (46%) and SMBs (41%) agree that adding a combination of standard and voluntary benefits is preferred.
- Standard benefits = SMB (employer) paid
- Voluntary benefits = employee paid
Younger employees (Gen Z and Millennials) prioritize adding:
- Paid family or medical leave (46%)
- Mental health benefits (40%)
- Health insurance (39%)
- Emergency savings (36%)
| Top benefits to add | ||
|---|---|---|
| Ranking | SMB top benefits | Employee top benefits |
| 1 | Mental health benefits (26%) | Retirement benefits (38%) |
| 2 | Health insurance (22%) | Health insurance (37%) |
| 3 | Paid family/medical leave (21%) | Paid family/medical leave (36%) |
| 4 | Life insurance (19%) | Mental health benefits (34%) |
| 5 | Retirement benefits (18%) Emergency savings (18%) |
Dental insurance (32%) |
| 6 | Key employee benefits (16%) |
Vision insurance (30%) |
| 7 | Childcare assistance (15%) Vision insurance (15%) |
Emergency savings (29%) |
Data shows
Retaining key employees is a top business issue for SMBs (94%).
Though the percentage of difference has narrowed, employees continue to be more concerned than SMBs about:
- Attracting qualified employees
SMBs 66% vs. Employees 78% - Employees’ ongoing mental health/wellness
SMBs 64% vs. Employees 70% - Employees leaving/taking other jobs
SMBs 58% vs. Employees 69%
Employee benefits help with:
- Recruiting and retention (54%)
- Retaining key employees (50%)
| Employees considering an employment change | |||
|---|---|---|---|
| Employees | Gen Z / Millennials | Gen X | Boomers |
| Considering changing jobs in same career | 61% | 64% | 51% |
| Actively looking for new job | 57% | 54% | 41% |
| Delaying retirement | 45% | 47% | 63% |
| Considering changing jobs/switching careers | 49% | 49% | 37% |
| Considering phased retirement | 40% | 45% | 41% |
| Considering early retirement | 30% | 30% | 20% |
Putting insights to work
Mental health
75% of SMBs say employee mental health will remain a top business issue for them in the future.
Support your employees’ mental health through workplace and financial wellness initiatives.
Mental health guide
Employee benefits
68% of SMBs agree they’ll have to improve employee benefits to remain competitive.
See how your employee benefits compare to other organizations of your size, industry, and region.
Compare benefits
Recruiting and retention
60% of employees are considering changing jobs in the same career. This response is higher with Gen Z, Millennials, and Gen X.
Employee retention guide
