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Retirement Plans Remain ‘Critical Component’ in War for Talent

Practice Management

While the broad scope of workplace benefits continues to evolve, findings from a new consumer research survey reveal that an employer-sponsored retirement plan is just as important for employee retention as a competitive salary and flexible work arrangements. 

Specifically, the research from Voya Financial shows that, among working Americans, 60% are more likely to stay with their current employer if they offer an employer-sponsored retirement plan. Equally important to working individuals were a competitive salary or compensation package (64%) and flexible work hours (63%). 

“We know that the COVID-19 pandemic has forever changed the workplace benefits and savings landscape and, as a result, many employers continue to evolve their offerings to support their workforce, particularly as an opportunity to attract and retain talent in today’s competitive market,” notes Heather Lavallee, CEO of Wealth Solutions, and president and CEO-elect of Voya Financial. “At the same time, amid new offerings such as flexible or hybrid work arrangements, employers need to remember the employer-sponsored retirement plan is a critical component to helping individuals prepare for a more secure financial future.”

Long-Term Focus  

Voya’s survey also reveals that, due to inflation, more than three-quarters (76%) of individuals are extremely likely or likely to spend less on non-essential items next year, which the firm notes could include things like meals out, vacations or luxury goods. 

Respondents, meanwhile, indicate that they are maintaining a focus on the long-term benefits of saving, with nearly 7 in 10 (68%) saying they have plans to save for retirement next year. This focus on preparing for the long term becomes even more important as individuals continue to want to “stay the course” despite today’s market uncertainty. 

To that end, the survey reveals that more than 8 in 10 (81%) respondents find that having a long-term view for their investments is “important” or “extremely important,” with 79% agreeing on the importance of staying the course during a volatile market.

“It’s extremely encouraging to see individuals keeping a focus on their long-term goals, despite the rollercoaster of financial extremes many have experienced over the past several years,” Lavallee further observes. “All employers should take note of the steadfastness that working Americans are expressing when it comes to the value of building their retirement savings through their workplace plan.” The Voya CEO-elect adds that this is particularly important as their survey also found that 75% of individuals plan to follow a financial plan and budget in 2023.

Workplace Benefits  

While a retirement plan remains an important aspect of the overall workplace benefits package, Voya’s survey reinforced the valuable role that workplace benefits are playing in the lives of working Americans—particularly when it comes to both their health and wealth needs. 

More than half (52%) of employed individuals said they are more likely to stay with their current employer if they offer: 

  • physical health benefits/programs, such as gym reimbursement and discounts;
  • financial wellness benefits, such as access to tools and resources for budgeting, building savings and reducing debt; and 
  • a workplace emergency-savings plan. 

Moreover, nearly half (49%) are more likely to stay with their current employer if they offer access to voluntary benefit offerings like critical illness, hospital indemnity, disability income and accident insurance. Similarly, the findings show that 47% are more likely to stay with access to health spending and savings accounts (HSA, FSA, dependent care account).

“More and more employers today are being proactive with their offerings as they understand the short-term financial needs of their workforce can have a direct impact on their ability to save for the long term,” adds Lavallee. “Programs that provide student loan debt support, caregiver needs, building emergency savings and access to financial professionals or advice tools are all things to ask about when it comes to support the breadth of financial planning needs individuals face today.” 

The findings are based on the results of a Voya Financial survey conducted Oct. 10-11, 2022, on the Ipsos eNation omnibus online platform among more than 1,000 U.S. adults.