Small business retirement plans

The importance of employer perceptions of benefits and costs


At any given time, only about half of U.S. private sector workers are covered by an employer-sponsored retirement plan, and few workers save without one. The coverage gap, which undermines the retirement income security of the nation’s workers, is driven by a lack of coverage among small employers. But, in fact, about half of firms with fewer than 100 employees do offer a plan for their employees.


2023 Small Employer Retirement Survey summary


This study presents results from our 2023 Small Employer Retirement Survey, which provides an up-to date and comprehensive understanding of why some small firms offer retirement plans and the barriers preventing other small firms from offering one. A unique aspect of this survey is the inclusion of 100 firms with 0 to 4 employees, a group typically ignored in most small business retirement surveys.


Key Survey insights:

  • Firms’ perceptions of the value of retirement plans for hiring and retaining workers and of the costs involved are important determinants of whether they offer, or will likely offer, a plan.
  • As in previous surveys, firms report that the two main barriers to offering a plan are: – Revenue stability/size of the firm – Perceived costs or administrative burden of having a plan
  • However, concerns about costs or administrative burdens are driven by misperceptions; many firms are unaware of lower-cost options and tax credits.
  • Finally, the recent growth of state-sponsored retirement programs may encourage firms without a plan to offer one.

Read the full study

Read our study for more information as the results of this study suggest that many firms overestimate the financial and time costs required to offer a plan, and that better awareness of lower-cost plan options and tax credits could help move the needle on the coverage gap.

Contact a team member today

Let us help you differentiate your business and empower your employees to take control of their full financial lives.