On top of worries about job instability and increasing workload, employees are also concerned about their pensions. This worry is fitting. In the UK, “The latest figures from KPMG show that 22 per cent of FTSE 100 companies do not have the funds to clear current pension deficits. The combined shortfall among the UK’s largest businesses is now estimated to be £80 billion – an amount which has quadrupled since the end of 2007,” writes Michelle Stevens of People Management. Meanwhile, Mercer reports that the  “Pension plan deficit hits record $409 billion for S and P 1500 companies.” Moreover, pensions within both the private sector and the public sector have been affected. According to CCH, “Investment losses from the current recession have significantly eroded the funding status of public pension plans, affecting entities from school districts and local and state governments, and there is growing concern that increasing deficits in public plans will force taxpayers to make up for the shortfall.” Thus, as the following Time Magazine article suggests, “It’s become distressingly clear that employees are increasingly on their own when it comes to retirement savings and health care.”

All this stress has an influence on employee performance. A Towers Perrin quarterly survey of over 650,000 employees worldwide, suggests that “As the global recession wears on, employees are feeling increasing stress in the workplace that, if left unchecked, could impact business performance.” As a result, some organizations are making an extra effort to help employee save for retirement on their own.

Ed Golitko writes in Talent Management Magazine about an effort on behalf of EMC Corporation to team "up with Fidelity Investments' Consulting Services group to create a financial prioritization tool called WealthLink."  This tool gives employees more control over their savings plans.

Hewitt Associates LLC suggests that companies “Make every effort to continue to provide the company contributions, both matching and nonelective” and encourage employees to contribute fully on their own. Other advice involves offering “employees choices” and asking “for their input on how benefit dollars are distributed,” providing investment advice, and automating enrollment.

Retirement saving support can not only help reduce employee stress levels, but it could also lead to improved retention rates.  A recent article in Talent Management Magazine reports, “According to a recent "Towers Perrin Global Workforce Study," competitive retirement benefits are among the top 10 considerations for prospective employees, and retirement benefits that meet individual needs are among the top 10 drivers of employee retention.”

References:

CCH. “EBRI Finds That Public Pension Plan Deficits Are Growing.” CCH® Pension and Benefits — 04/20/09 [www.hr.cch.com]. April 20, 2009.

Curran, John. “The Search For The Next Perk.” Time Magazine –reprinted on Towers Perrin [www.towersperrin.com]. May 25, 2009.

Golitko, Ed. “EMC: Helping Employees Save for Retirement.” Talent Management Magazine [www.talentmgt.com]. July 2009.

Hewitt Associates LLC. “The Moving Retirement Target: Helping Your Employees Save During the Downturn.” [www.hewittassociates.com]. 2009.

Mercer. “Pension plan deficit hits record $409 billion for S&P 1500 companies; pension expense may rise.” [www.mercer.com]. New York: January 7, 2009.

Stevens, Michelle. “Growing pension deficit threatens schemes.” People Management [www.peoplemanagement.co.uk]. August 14, 2009.

Towers Perrin. “Employee Stress Can Add to Performance Risk” [www.towersperrin.com]. May 2009.