Competition for talent is fierce in this very low unemployment environment, so more small businesses are sweetening their benefits packages to win over skilled workers, according to Guardian's 5th Annual Workplace Benefits Study, “Small Business, Big Benefits.”

Nearly two-thirds (61 percent) of small businesses aim to offer a better benefits package than their competitors, and the percentage increases among start-ups (70 percent) and high-tech firms (81 percent). Over the past five years, more small businesses have established flexible work schedules, telecommuting and wellness programs to help employees improve their work-life balance.

“Creating a benefits experience that employees value allows small business owners to demonstrate they care about the well-being of their employees—which leads to stronger employee loyalty,” says Marc Costantini, Guardian's executive vice president, commercial and government markets.

Indeed, 55 percent of workers who feel their employer cares about their well-being want to stay at their company for 10 years or more, compared to 33 percent who don't believe their company cares, according to the Guardian study. Women and millennial small business owners place even more importance on benefits that support workforce health, financial and emotional well-being. For example, 66 percent of millennial small business owners agree their company creates a culture of well-being, versus 51 percent of baby boomer owners.

For those employers offering workers high-deductible health plans, more employers are offering supplemental health coverage to help workers pay for expenses not covered by their health plans. Additionally, 53 percent of employers plan to implement strategies to help workers make better benefits decisions over the next five years and 44 percent plan to increase employee financial education.

More small businesses are able to boost their benefits packages due to cloud-based software, and the Guardian study found that more than 50 percent of small businesses have digitalized a majority of their benefits process to enhance the employee experience, as well as help improve efficiency and compliance.

Outsourcing benefits administration has also become an important benefits strategy for small firms, according to the study. Roughly 30 percent of small business owners have increased their level of administration outsourcing in the last three years, and 24 percent believe outsourcing will be a top benefits strategy in the next five years.

“As small businesses rethink their employee benefits strategy, we recommend evaluating what motivates their employees and work closely with a trusted advisor who is knowledgeable in key areas like benefits technology, voluntary benefits and compliance,” says David Poirier, Guardian's national director of small group sales.

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