Retirement Help is on the Way for America’s Small-Business Workers

retirement readiness

America’s workers are facing a retirement readiness crisis. That’s according to 86 percent of small-business owners recently surveyed online by Harris Poll on behalf of Nationwide.

The good news is that business owners are taking action. The survey found that 3 in 5 small-business owners who offer retirement plans (58 percent) say they plan to increase contributions, and 19 percent of business owners who don’t currently offer 401(k) plans say they will offer them in the future.

The Affordable Care Act (ACA) and optimism about the economy and sales are the primary contributors to the positive retirement outlook.

Of business owners who currently offer retirement benefits and plan to increase contributions:

  • 56 percent say it is because they expect company sales or revenue to increase in the next 12 to 24 months;
  • 41 percent believe that the U.S. economy will improve in the next 12 to 24 months;
  • And, 43 percent say it is because their 401(k) plan is now more important for attracting and retaining employees as a result of the ACA.

Business owners who don’t currently offer retirement benefits but say they plan to in the future, have a similar outlook:

  • 41 percent say it is because they expect the company’s sales or revenue to increase in the next 12 to 24 months;
  • 35 percent believe the U.S. economy will improve in the next 12 to 24 months;
  • And, 23 percent say they will offer retirement benefits in the future because a 401(k) plan is now more important for attracting and retaining employees as a result of the ACA.

 Methodology

The Small Business Owner Study was conducted online by Harris Poll on behalf of Nationwide from June 10-23, 2016. Respondents comprised 502 U.S. small business owners of companies with less than 300 employees – “business owners”, including 185 small business owners who currently offer 401(k)’s and plan to increase contributions and 102 small business owners who don’t currently offer 401(k)’s but plan to in the future. Results are weighted to be representative of small-business owners in the U.S. Research participants were drawn from the Harris Poll Online (HPOL) research panel and partner sample. Because the sample is based on those who were invited to participate in the HPOL panel, estimates of theoretical sampling error cannot be calculated. Percentages were rounded to the nearest whole percent. Differences in the sums of combined categories/answers are due to rounding.

 

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