The tight labor market shows no signs of easing in the coming year, likely making benefits and retirement plan options an important part of employee recruitment and retention.
“This open enrollment season is an important time for employers to get the pulse of their workforce and staffing needs as they face another year of competition for talent,” said Sri Reddy, senior vice president of retirement and income solutions for Principal Financial Group.
Principal asked retirement plan participants and plan sponsors about financial behaviors and planning in its latest survey. The results point to a volatile workforce. Twelve percent of workers are looking to change jobs, 11 percent plan to retire or leave the workforce and 11 percent are on the fence about staying in their job, making a combined 34 percent of workers unsettled in their current role. Employers echoed these findings, with 81 percent concerned about increased competition for talent.
Workers cited their top motives in considering a job change as increased pay (60 percent), feeling undervalued in their current role (59 percent), career advancement (36 percent), more workplace benefits (25 percent) and hybrid work arrangements (23 percent).
Workers also identified a strong focus on retirement planning and security when making decisions. More than three-quarters said the COVID-19 pandemic has driven them to focus more on saving for retirement. The most important retirement plan features workers consider when evaluating new job opportunities are:
- Employer match (91 percent)
- Eligibility (80 percent)
- Vesting requirements for company matches (74 percent)
- Investments options on offer (73 percent)
- Withdrawal options at job change or retirement (70 percent)
Retirement plan sponsors appear more focused on meeting workers’ retirement savings needs. The survey showed that 67 percent of sponsors intend to focus on retirement planning education in 2022, up from 48 percent this year. Meanwhile, more than half of workers considering a job change said they would roll over their current retirement plan to an IRA or to their new employer’s retirement plan.
“We had seen a strong rebound in optimism through the first half of this year as consumers felt more positive about the management of COVID-19 and saw strong market gains,” Reddy said. “Now, new concerns over inflation, supply chains and the continued impact of the pandemic are beginning to weigh on many Americans.”