According to a nationwide survey of small business owners by ShareBuilder 401k, nearly one-quarter (24%) of small businesses now offer a 401(k) plan (compared to 10% in 2008). Eighty-nine percent of small business owners with more than one employee that offer a 401(k) plan said it is an important factor for attracting and retaining the best talent.
Additionally, 50% of those who offer a 401(k) plan believe offering a plan is their responsibility as a business owner. Of the 28% of businesses with a 401(k) plan that either stopped offering a match or lowered their match over the past five years, 56% have since reinstated it.
The majority of small business owners (58%) said their own current retirement savings is higher than it was five years ago. Nearly two-thirds (65%) now feel confident they are saving enough for retirement, compared to 44% five years ago. Eighty-two percent of all small business owners view 401(k)s as an effective approach to saving for retirement.
"Though the Great Recession had a negative impact on many Americans' retirement plans, it appears it was also a wake-up call when it comes to planning for the long term," said ShareBuilder 401k President Stuart Robertson. "A record percentage of small businesses are reporting ownership of a retirement plan—a sign that more small business owners are prioritizing their own and their employees' need to save for the future."
The survey also found the two biggest reasons more small businesses are not offering a plan to be "not enough employees to make it worthwhile" (reported by 48% of respondents) and "can't afford to offer a company match" (at 23%).
The comparative data used for the survey comes from a similar survey of small business owners commissioned by ShareBuilder 401k called the "2008 Small Business Annual Retirement Trends" report. Both this year's survey and the 2008 research included responses from 500 small businesses from across the United States with 50 or fewer employees.
ShareBuilder 401k recently announced a No Fee Week for new plans (see “Plan Provider Waives Plan Startup Costs”).