Small businesses are offering retirement plans a lot more often than they used to, and white-collar workers are benefiting the most.
Nich Tremper, senior economist at payroll and benefits platform Gusto, said over 5 million more small-business workers had access to retirement plans than in 2019. He said in a post that “industries that have historically not offered 401(k)s are now doing so more often.” For instance, the share in the hospitality sector climbed from 4% in 2019 to 12% in 2026.
Public administration, professional services, and finance had the highest shares of businesses offering plans among 18 sectors, with public administration, information, and healthcare experiencing the largest percentage-point increases between 2019 and 2026.
Tremper told Business Insider that business owners thinking about the long-term finance of their workers, attempts to mitigate attrition, and newer state mandates are some of the plausible reasons behind the increases across sectors.
Non-exempt businesses in California that don’t already have a qualified retirement plan and employ at least one worker need to offer the state-facilitated retirement savings program. On the other side of the country, in Delaware, employers that conduct business in the state and don’t already offer a qualified plan and have at least five W-2 employees must offer Delaware’s program.
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Having a retirement plan can help small businesses stay competitive with big corporations in the talent wars. Howard Telson, who has run a small accounting firm since 2022, said the firm consistently hires, and a lot of his workers came from larger employers.
“At a certain point, I think it becomes almost required if you’re competing against bigger companies who have substantial benefits,” said Telson, who started offering a 401(k) plan about a year and a half ago.
In 2019, about a third of hourly workers with an available plan participated, compared to 45% in 2026. For salaried workers, the rise was much smaller, from 70% to 73%.
“While the overall savings rate has declined among small business employees, most of this can be attributed to an increase in the share of hourly workers saving for retirement,” Tremper said in the post. “This is a compositional shift that shows the breadth of new 401(k) access to workers throughout the economy.”
