Data & Research April 12, 2010

Survey: Retirement Plan Cutbacks to Stay in 2010

A majority of employers that made changes to their retirement plans in response to the economic downturn expect to keep those changes in 2010, according to a new Buck Consultants Survey.
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A Buck news release said 77% of employers with defined benefit plans and 52% of employers with defined contribution plans will not reverse changes or are uncertain if they will reverse previous changes.

The most common changes employers made to DB plans in response to the downturn were to freeze participants’ benefits at their current levels (68% of plans covering salaried employees) and to close the plan to new employees (32% of plans covering salaried workers).

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Twenty-four percent of respondents elected to make changes to their DC plans during 2009. The most common change was to reduce employer contributions. Only 6% of respondents with a DC plan with employer matching contributions reported increasing their match during 2009.

More than 40% of survey respondents reported that their DB plan’s funded status had lost more than 20% of its value due to the economic downturn.

The study analyzed responses from nearly 200 organizations.

Data & Research April 12, 2010

Employees Want Financial Guidance in the Workplace

Seventy-seven percent of employees said financial advice and guidance programs would improve their productivity in the workplace, according to MetLife’s 8th annual Employee Benefits Trends Study.
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Furthermore, more than half (54%) of employees reported that the economic events of the past 12 months have made them realize that they need to more actively manage saving for retirement. Forty-two percent of employees are interested in their employer providing access to retirement planning seminars, yet only 35% of employers currently offer these.  

However, 38% of employers  believe retirement programs (i.e. offering 401(k), retirement seminars, access to retirement planning professionals, etc.) are very effective in improving employee productivity, MetLife said. 

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One-quarter of employees admit feeling more distracted at work because of financial worries, and more than half (56%) of working Americans and 62% of working women are very concerned about just making ends meet. Only about one-third (37%) of employees surveyed express confidence about their ability to make the right financial decisions. 

Many employers are recognizing the impact that these financial woes might have on their company’s bottom line in lost productivity costs. Almost two-thirds (65%) of employers believe that employees are less productive at work when they are worried about personal financial problems, and more than half (52%) believe that absenteeism increases when employees are dealing with personal financial issues.  

The 8th Annual MetLife Employee Benefits Trends Study was conducted during the fourth quarter of 2009 and consisted of two distinct surveys fielded by GfK Custom Research North America. The employer survey comprised 1,503 interviews with benefits decision-makers at companies with staff sizes of at least two employees. The employee survey comprised 1,305 interviews with full-time employees age 21 and over, at companies with a minimum of two employees. 

The study is available at www.metlife.com/trends2010.

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