Most Microbusiness Owners Have Health Care Coverage but Benefits Have Not Yet Reached Employees, Sam’s Club Survey Reveals
October 29 2014 - 9:00AM
Business Wire
- Only one in ten (9%) microbusiness
owners funded their own health care insurance from within the
microbusiness itself
- 70 percent of microbusiness owners
with employees say they do not plan to offer employee health care
benefits in the next 12 months
If you’re running a company of five or fewer workers, chances
are you’re relying on funds for health care insurance from a source
outside of that company. If you’re an employee of a microbusiness,
you’re likely not relying on your boss to cover your health care
benefits, according to the Sam’s Club/Gallup Microbusiness
Tracker.
Sam's Club and Gallup discovered that microbusiness owners, many
of whom are moonlighting to pursue their small business dream, are
getting creative in financing their own health care coverage. Only
one in ten (9%) of the microbusiness owners funded their own health
care insurance from within the microbusiness itself. More than 50
percent rely on their primary job or pay for it out of their own
wallet, showing a diverse pool of sources for medical benefits:
- 32% from a current or former employer
that is not the microbusiness
- 23% from insurance paid for on their
own but not through the microbusiness
- 19% from Medicare
- 9% from insurance paid for through the
microbusiness
- 4% from military or veteran
benefits
- 1% from a union
- 1% from Medicaid
- 1% other or undisclosed
According to the Sam’s Club/Gallup Microbusiness Tracker,
microbusiness owners with employees say they largely do not offer
health care benefits to their employees now (76%), did not provide
these benefits in the past (63%) and do not plan to offer these
benefits in the next 12 months (70%). For those employers that do
provide the benefits, looking at the business outlook ahead most
(78%) plan to maintain them at a current level, with some (10%)
increasing the benefits and some (7%) lowering them.
"The microbusiness owners we track in this study have
demonstrated a steely resolve to know their customers and deliver
quality products or services to market. Their sometimes razor-thin
margin business models do not always leave room to cover health
care,” explained Rosalind Brewer, president and CEO of Sam’s Club.
“Yet, health benefits are a key differentiator for many
microbusinesses and a recruiting tool for top talent so it’s an
issue the small business community is watching closely.”
The survey found that one in three (38%) microbusiness owners
with employees see providing adequate benefits to their employees
as a major issue. This number increases for newer
microbusinesses.
In terms of financing, the Sam’s Club/Gallup Microbusiness
Tracker finds that owners continue to fund their business from a
range of sources, with personal savings (66.6%) and credit cards
(40.6%) remaining the most commonly utilized sources.
More veterans have used bank loans (37.0% compared to 28.7%) or
retirement savings (38.2% compared to 27.7%) to fund their business
compared to owners who haven’t previously served. Examining gender,
male owners are more likely to use bank loans (34.1%) compared to
their female counterparts (22.6%).
Microbusiness owners remain concerned about future cost
increases, mainly taxes (67.2%) but also for employee health
benefits (40.9%), utilities (37.9%) and other business costs such
as transportation (32.5%).
The Sam’s Club/Gallup Microbusiness Tracker results
reflect 1,006 phone interviews conducted September 2-16, 2014 with
companies of five or fewer workers. For further information please
view Gallup’s article Microbusinesses Struggle to Cover Health
Insurance Costs and download the Sam’s Club/Gallup Microbusiness
Tracker October 2014 Report at SamsClub.com/newsroom.
About The Sam’s Club/Gallup Microbusiness Tracker
The Sam’s Club/Gallup Microbusiness Tracker is a nationally
representative survey that regularly reports on U.S. businesses
with five or fewer workers, a key driver of U.S. economic growth.
The tracker provides valuable insight into the mood and mind of
microbusiness owners for decision makers and influencers in
government and commerce by highlighting the unique concerns and
challenges of microbusinesses along their path from startup to
maturity. To learn more about the Sam’s Club/Gallup Microbusiness
Tracker, visit SamsClub.com/Newsroom or Gallup.com.
About Gallup
Gallup delivers forward-thinking research, analytics, and advice
to help leaders solve their most pressing problems. Combining more
than 75 years of experience with its global reach, Gallup knows
more about the attitudes and behaviors of the world's constituents,
employees, and customers than any other organization.
About Sam’s Club
Sam’s Club®, a division of Wal-Mart Stores, Inc. (NYSE: WMT), is
a leading membership warehouse club offering superior products,
savings and services to millions of members in 643 clubs in the
U.S. and Puerto Rico. To learn more about Sam’s Club, visit
the Sam’s Club Newsroom, shop at SamsClub.com, and
interact with Sam’s Club
on Twitter and Facebook.
Sam’s Club Media RelationsCarrie Foster Moore,
1-800-331-0085SamsClub.com/newsroom
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