Day: August 18, 2026

Small businesses are increasingly using 401(k) plans as recruiting and retention tools as they compete for workers and weigh the cost of employee benefits. Sara Marye, Howard Telson, and Ashley Kent have taken different approaches, while Gusto and Indeed data offer a broader look at how retirement benefits are appearing in the labor market.

Key Takeaways

• The Stellar Teacher Company began offering a 401(k) in 2025 after an employee moved into a full-time role.
• Scale CPA uses its retirement plan as part of its recruiting and employee retention strategy.
• Clearstart offers a 401(k) to 10 full-time employees while delaying healthcare coverage because of cost.
• Gusto data found roughly 8% fewer first-year quits among small businesses offering 401(k) plans.
• Indeed data showed 401(k) mentions increasing across several categories of U.S. job postings between early 2020 and spring 2026.

Gusto’s analysis of its small-business data found companies offering 401(k) plans had roughly 8% fewer employee quits during the first year of employment than companies without the benefit. The finding shows an association rather than proving that retirement plans alone cause workers to stay.

Job-posting data from Indeed points to a similar shift in how employers present retirement benefits. Between early 2020 and spring 2026, mentions of 401(k) plans increased across several occupations.

For small-business owners, however, offering the benefit remains a financial decision. The experiences of Marye, Telson, and Kent show how companies are balancing retirement plans against workforce needs, healthcare expenses, and other operating costs.

The Stellar Teacher Company Adds a 401(k) as Its Workforce Changes

Sara Marye added a 401(k) at The Stellar Teacher Company after a longtime part-time employee moved into a full-time position in 2024. The company began offering the retirement plan in 2025.

Marye founded The Stellar Teacher Company after working as an educator. The business has four part-time workers, most of whom are former teachers who remain involved in education while raising their children.

The 401(k) gave those workers access to a retirement benefit while also providing an additional benefit for the company’s full-time employee. Marye considered the cost before introducing the plan.

The benefit was added alongside the company’s existing flexible workplace arrangements rather than replacing them. Marye, who works on the company’s payroll, also gained access to the retirement plan.

Her decision reflects how employee benefits can become more important as a small company’s staffing structure changes. Benefits are only one part of broader employee retention strategies, which can also involve growth opportunities, workplace practices, and employee engagement.

Scale CPA Builds Retirement Benefits Into Its Hiring Strategy

Howard Telson has taken a more direct recruiting approach at Scale CPA, the remote accounting firm he started in 2022.

The firm began offering a 401(k) roughly a year and a half before the August 2026 report. Telson said the retirement benefit helps Scale CPA compete for candidates who may also be considering larger companies and accounting firms.

The benefit also matters to existing employees who previously worked for larger employers and may already be accustomed to employer-sponsored retirement plans.

For Scale CPA, the 401(k) is therefore part of both recruitment and retention.

As the firm hires and defines new roles, retirement benefits form one piece of a broader growth strategy. Companies navigating efficient business scaling also have to consider hiring, training, operational systems, and team development as headcount increases.

Telson also discusses retirement plans with small-business clients through his accounting work. He said the plans can provide tax deferral and personal tax savings for some business owners while supporting employee recruitment.

He also cited tax credits that may be available during the first three years after establishing a retirement program. Those financial considerations can affect how an employer evaluates the cost of introducing a plan.

Clearstart Chooses a 401(k) While Delaying Healthcare

Ashley Kent faces a different benefits calculation at Clearstart, a marketing brand and growth consultancy for healthcare organizations.

Kent has operated the company since 2018 and currently employs 10 full-time workers. Employees become eligible to participate in the company’s 401(k) after completing one year of employment.

Kent said the benefit supports employee retention in an agency environment where turnover remains a concern. She also views the plan as a factor that can make Clearstart more competitive when recruiting.

Healthcare coverage remains a separate issue.

Clearstart has not added employer healthcare benefits because Kent said the cost remains too high for a company of its current size. She is reconsidering that decision as the business hires more senior employees, since health coverage can influence candidates comparing employment opportunities.

The company’s approach illustrates how small employers may evaluate retirement and healthcare benefits independently rather than introducing both at the same stage of growth.

Gusto Data Shows Fewer First-Year Quits Among 401(k) Employers

Gusto’s internal analysis found roughly 8% fewer first-year quits among small businesses offering 401(k) plans compared with businesses that did not offer them.

Nich Tremper, a senior economist at Gusto, said the first year is when employers face the greatest risk of an employee leaving.

A departure can create an immediate staffing gap while the employer recruits and trains a replacement. That disruption can also affect productivity if the position remains unfilled.

The Gusto data does not establish that offering a 401(k) directly causes lower turnover. Instead, it identifies an association between access to the benefit and first-year quit rates.

Retirement-plan administration has also become more accessible to smaller employers through payroll providers. Gusto and ADP offer 401(k) management services using pricing structures that can include base fees and charges tied to individual participants.

For owners such as Marye and Kent, that means a retirement plan can be considered independently from more expensive benefits such as healthcare.

Job Postings Show Broader Growth in 401(k) Mentions

Indeed data covering employers of different sizes showed a substantial rise in U.S. job postings mentioning 401(k) plans between early 2020 and spring 2026.

The increase varied considerably by occupation.

Mechanical engineering postings mentioning a 401(k) rose from 16% in early 2020 to 65% in spring 2026. Logistics support postings increased from 16% to 61%.

Accounting postings climbed from 16% to 53%, while marketing increased from 13% to 45%. Customer service postings rose from 20% to 44%.

Education and instruction remained lower, increasing from 7% to 15%. According to Laura Ullrich, the difference is partly related to the greater prevalence of pensions in education rather than defined-contribution plans such as 401(k)s.

Indeed Hiring Lab also found an increase in postings advertising employer 401(k) matches of at least 5%. The three-month moving-average share of postings advertising matches at that level had risen more than fivefold compared with January 2020.

The increase gives job seekers more information about total compensation when comparing positions. For smaller employers, it also means retirement benefits are increasingly part of the compensation packages candidates may encounter elsewhere.

Retirement Benefits Become Part of the Small-Business Hiring Equation

Marye, Telson, and Kent have adopted different eligibility rules, cost structures, and reasons for offering retirement plans.

The Stellar Teacher Company introduced its plan after an employee moved into full-time work. Scale CPA incorporated a 401(k) more directly into recruiting. Clearstart offers the benefit while continuing to weigh the affordability of healthcare coverage.

Their experiences show that small business 401(k) benefits are not being adopted through a single model. Owners are making decisions based on staffing needs, recruiting competition, company size, and the cost of other benefits.

The Gusto and Indeed data add a broader labor-market context. Retirement benefits are becoming more visible in job postings, while Gusto’s analysis suggests companies offering them may also experience lower first-year quit rates.

For small employers competing for workers, the 401(k) is increasingly one factor in a larger decision about compensation, retention, and the benefits a business can realistically afford.

Frequently Asked Questions

Are 401(k) plans available to small businesses?

Yes. Small businesses can establish 401(k) retirement plans for eligible employees. Payroll providers including Gusto and ADP also offer plan administration services aimed at smaller employers.

Can a 401(k) help a small business retain employees?

Gusto’s internal data found roughly 8% fewer first-year quits among small businesses offering 401(k) plans than among businesses without them. The analysis shows an association, however, and does not establish that the retirement plan alone causes employees to remain with a company.

Why are small business 401(k) benefits becoming more relevant?

Small business 401(k) benefits can give employers another component of total compensation when competing for workers. Indeed data also showed 401(k) mentions becoming more common across several categories of U.S. job postings between early 2020 and spring 2026.

Can a small business offer a 401(k) without healthcare?

Yes. Clearstart offers employees a 401(k) while delaying healthcare coverage because founder Ashley Kent said healthcare remains too expensive for the company’s current size.

How much does a small-business 401(k) cost?

Plan expenses vary by provider and participation. Gusto and ADP offer administration services that can include a base fee and additional participant fees, while individual businesses must weigh those costs against other employee benefits.