Compensation Management News
State:
Category
Topic *Please pick a topic
June 19, 2002
Survey Finds Benefits on the Rise
DesFor a Limited Time receive a
FREE Compensation Market Analysis Report! Find out how much you should be paying to attract and retain the best applicants and employees, with
customized information for your industry, location, and job.
Get Your Report Now!
The Principal Financial Group's "Well-Being Index" for the second quarter of 2002 shows a fourth consecutive quarterly increase in the number of firms that offer health insurance, defined contribution plans, life insurance and disability insurance. These four benefits are also ranked as the four most important benefits among workers, according to Principal.
This latest national survey of 1,500 employees of growing businesses showed 70 percent of all respondents agreed that a good benefit plan encourages them to work harder and perform better. This figure increased nearly 9 percent from the First Quarter 2002 Index.
"Despite headlines announcing employee cutbacks, growing businesses appear to be increasing their employee benefits, especially those most important to their staff," noted Daniel J. Houston, senior vice president of the Principal Financial Group. "This is especially interesting considering that last quarter's index revealed that one in three employees expected their benefits to decrease as a result of the slumping economy."
"This Well-Being Index clearly suggests a link between solid benefits and happier, more productive, and loyal employees. Improving benefits, especially core ones, helps firms recruit and retain talent and enhance performance," continued Houston.
Job security and long-term concerns
The Index confirmed that job security continues to be a source of major apprehension for the American workforce, with 52 percent of respondents ranking it as their top concern. This statistic has increased steadily over the past four quarters. Meanwhile, 78 percent of employees are very concerned about their long-term financial futures, down slightly from one year ago.
"Not surprising, the tight economy and layoffs around the nation have American workers concerned for their jobs," Houston commented. "But even as short-term considerations are paramount, they continue to worry about how they will prepare for retirement and secure their financial futures."
The Index revealed that only 58 percent of respondents are planning for retirement. Yet, a surprising 44 percent said they are confident in their ability to effectively transition their retirement savings into a dependable stream of retirement income.
"There is a distinct gap between those who are concerned about their financial futures and those who feel prepared to tackle the challenge, which is why investor education and guidance is more important now than ever in the past," explained Houston. "The role of employers is particularly important as the American workforce ages and looks to workplace benefits to help them save for the future and turn their nest eggs into a secure source of monthly income when their working days are over."
Despite highly publicized situations like Enron, where employees lost their retirement savings as their companies faltered, 62 percent of respondents do not include any of their firm's stock in their retirement plans. A mere 1 percent reported having more than 25 percent of their retirement investments savings invested in their employer's company stock.
"These statistics confirm the situations at Enron and Global Crossing are unfortunate exceptions and not the rule," offered Houston. "Yet they're poignant reminders of why retirement investors should maintain invested in well-balanced, diverse portfolios."
Of the 80 percent of survey respondents who expect a tax return from their April filings, most plan to use their returns to pay down their short-term debt or deposit the amount in their savings or checking accounts.
Participate in this week's HR.BLR.com poll and discussion!