Workers with leverage increasing expectations of financial well-being, 401 (k) benefits
The so-called Great Resignation created a seller’s market for job seekers.
Nearly four and a half million Americans quit their jobs in November, continuing a continuing trend, according to the United States Bureau of Labor Statistics. As a result, employees have more leverage than ever to demand better benefits from their employers.
Employees face issues such as health care costs, mountains of student debt, and uncertainty surrounding retirement and the future of Social Security. Many workers are looking for more financial stability and support.
Betterment Company 401 (k) recently researched the state of employee financial well-being by interviewing 1,000 full-time workers.
“Our research shows that employees are still suffering financially from the economic impacts of the past 18 months, with many having had to dip into their emergency funds since the start of the pandemic,” according to the investigation report.
âWhile most employees haven’t quit their jobs voluntarily in the past year and a half, they want extra support from their employers to avoid being enticed to look elsewhere. Financial benefits are now their top priority, above office benefits and even vacations, and employees are looking for special help with retirement planning and student debt.
Among the highlights of the survey:
1. Status of the workforce. Despite the high turnover rates faced by many industries, the vast majority of full-time employees surveyed (94%) did not voluntarily quit their jobs in the past 12 months. However, 28% are currently looking for a new job.
“We see the impacts of COVID-19 through a number of responses – burnout, isolation and leaving the workforce to deal with personal issues were all highly cited factors,” indicates the report.
“With the proportion of people who left for a job that suited them better, almost equaling the proportion of people who left for better benefits or wages, it is clear that the pandemic has prompted workers to reassess what they have. need to be satisfied with their work. . Ideally, it should be both financially and emotionally fulfilling.
2. Employee expectations. Amid the financial challenges of the pandemic and the ongoing competition for talent, employees are demanding employer support more than ever. Seventy-eight percent said it was important for their employer to provide financial well-being benefits, and 71 percent said those benefits are even more important now than they were before the pandemic . Almost 70% of them feel they have better financial well-being benefits over an extra week of vacation.
When asked to prioritize financial wellness benefits, employees ranked access to a high-quality 401 (k) and 401 (k) match program as most important, followed by an allowance of wellness and a flexible spending account or health savings accounts.
An employer-sponsored emergency fund placed fifth. This benefit has come to light more since the start of the pandemic, and it shows employees’ appetites for employers to help them accumulate emergency savings.
3. Implications for retention. Three-quarters of workers would likely quit their jobs for an employer with better financial benefits. This is especially true among the younger generations. Employees reported that the top three most attractive benefits are a high-quality 401 (k), 401 (k) matching program, and a flexible spending account or health savings account.
A third said their employer started offering new financial welfare benefits in the past year, the most common being a 401 (k) welfare allowance, a 401 (k) matching program, which is what employees indicated they wanted from their employers. .
4. Student loan debt. Over a third of respondents are responsible for student debt, either their own or someone else’s. Despite this debt, people with student loans do a good job of saving money: 63 percent of student loan borrowers have an emergency fund, compared to 67 percent of those without. .
âIt’s clear that employees want more support when it comes to financial well-being,â the report concludes. âThis means helping them take advantage of the tremendous benefits your business currently offers, as well as rethinking the benefit offerings to fit their current needs. If your business still works remotely, it may be time to consider reorienting the old coffee and snacks budget towards a more flexible wellness allowance that employees can use to meet their current needs while at the same time. working from home.
âYour benefit package can’t – and doesn’t need to – meet all of every employee’s needs. However, there are simple and inexpensive ways to provide them with a comprehensive financial well-being solution that can offer retirement benefits, emergency funds, investments, access to financial advisors, and other counseling tools. planning. Large benefit packages no longer have to be expensive or time-consuming, whether your business has two or 2,000 employees. “