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Plan Insight

APRIL 2010 Newsletter

Recession Affects Employee Retirement

More than half (52%) of respondents to a Towers Watson survey said the percentage of their employees working past their desired retirement age is higher than it was before the financial crisis. --- Nearly one-third (31%) said they expect that percentage will be even higher next year, according to a press release.

In addition, 30% of companies reported employees have on average reduced their contributions to 401(k) plans from pre-financial crisis levels, and 51% have seen an increase in employees’ hardship withdrawals from pre-financial crisis levels. Almost half (48%) of U.S. respondents said employees had shifted 401(k) plan allocations out of equities; however, 37% expect employees to shift back toward equities a year from now, the survey found.

Thirty-two percent of companies reported that their employees’ cost of health care coverage is higher now than it was before the financial crisis, and 38% indicated they think it will be even higher a year from now.

While 28% of employers expect that, a year from now, they will put more emphasis on ensuring benefits provide a desired level of security for employees, the survey found much larger numbers of respondents expect to increase their focus on controlling and reducing benefit costs (53%) and managing the risk and volatility of those costs (49%).

The survey, based on responses from 118 mostly large employers in the United States and 459 employers globally, was conducted in early January.

 

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This page was last reviewed and/or updated on Monday, December 19, 2011 04:17 PM

 
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