Retirement benefits are typically a company’s most costly spend on employees outside of cash remuneration (salary and bonuses). That makes it an important area to understand employees attitudes and appreciation of the retirement benefits provided. Indeed, according our WTW’s Global Benefits and Attitude Survey Switzerland 2022, Retirement is the number 1 area employees most want support from their employer on (and this includes all employee topics such as flexible work, investing in their career and managing emotional health among other things).
A stark statistic is that 65% of employees think they are not saving enough for retirement compared to what they should. The retirement savings gap is the greatest with low salary and female employees. Despite this self-proclaimed gap in retirement savings, it is somewhat staggering that around 80% of Swiss employees still expect to retire at or earlier than the current normal retirement age for males (age 65). The question is whether employees are being realistic.
In terms of communication and technology it is interesting to learn that employees using retirement apps are more likely to say that their retirement plan meets their needs. Nearly 70% of employees who regularly use apps state that their retirement plan meets their needs (perhaps because it gives them a better understanding of their retirement plan). At the same time the overall employee use of apps for tracking and planning retirement is only at 9% (probably because not many retirement apps are provided in the market). This is an area where companies and their pension funds could make a real difference by offering better communication tools (such as apps) to improve their employees appreciation and understanding of the costly retirement benefits the company provides.
On the hot topic of ESG retirement investment, around a third of employees have an ethical preference for ESG (regardless of return outcome) while another third wish to maximise returns but are uncertain on how ESG investment will affect performance. Only around 10% of employees believe focus should be on maximising returns and believe ESG will perform better over the longer term. The remaining quarter or so want to focus on maximum returns and believe ESG will offer lower returns in the long run.
If you want to learn more about WTW’s Global Benefits and Attitude survey 2022, please reach out to your WTW consultant.
