The Pocketbook Issue --- Small Change: Competitive pressures are forcing some small Firms to improve their benefits
Marissa Verson, owner of Interactive Public Relations Inc. in San Francisco, kept losing her employees to larger rivals.</br></br>Frustrated, she revamped her benefits package late last year to include more vacation time for her 25 employees, a profit-sharing program and even weekly shiatsu massages. She says the result has been a sharp improvement in the employee-retention rate of the company, which serves mostly Internet-related firms.</br></br>"The economy dictates the competitive landscape," Ms. Verson says. "It's as hard to find people in my field as it is in computer programming. We have headhunters calling day and night."</br></br>Ms. Verson's complaint -- and solution -- is being echoed at small businesses across the country. While most small firms offer pared-down health-care or pension programs, some companies now say the nation's low unemployment rate is creating intense pressure to change. In industries or regions where the labor market is particularly tight -- such as high-tech and the Midwest, respectively -- companies increasingly say they have to improve their benefits in order to compete with large companies.</br></br>"We have people who came out of companies like Lotus or Digital," says Tony Friscia, president of Advanced Manufacturing Research Inc., a Boston consulting firm. "They're used to having all these benefits -- family dental coverage, eye care, disability. They don't want to just walk away from that."