Benefits July 24, 2023

Employer-Sponsored Retirement Plans Continue to Be Valued by US Workers

American workers are more likely to remain with their current employer if offered an employer-sponsored retirement savings plan and at a higher rate than revealed in October 2022, Voya research found.

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More than seven out of 10 (71%) employed Americans were more likely to stay with an employer that offered an employer sponsored a 401(k), 403(b) or 457 retirement savings plan, an increase from 60% in a 2022 survey, according to the “Voya Consumer Omnibus Research: Retirement Report Q2 2023” from Voya Financial.

The figure was significantly higher for respondents with a managed account (85%), as compared with all others (64%), the survey found.

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If plan sponsors were not already aware of the evidence that employees are choosing to work for and remain employed for longer periods by employers that offer a retirement plan benefit, Voya Financial found that employers remain a critical source for retirement savings support, as revealed by participants’ responses.

Voya found that 51% of employed Americans were more likely to stay with their current employer if offered education, guidance, tools and resources to help them reach their retirement goals, and that this is higher among those with student loan debt (63%), compared with those with no student loan debt (48%).

The SECURE 2.0 Act of 2022 permits employers an optional retirement plan provision to make retirement plan matching contributions to 401(k), 403(b), 457(b) and SIMPLE IRA accounts for participants who pay down student loan debt instead of contributing to a retirement plan.

Since the COVID-19 pandemic, workers have increasingly expected their employers to provide a retirement benefit, Vestwell research published earlier this year showed.

Similarly, when Voya asked respondents, “What impact, if any, would each of the following have on your likelihood to stay with your current employer?” it found that employed Americans said they are more likely to stay with their current employer if offered:

  • Competitive salary/compensation package: 75%;
  • Flexible work hours: 70%;
  • Ways to improve their overall financial wellness: 61%;
  • Physical health benefits/programs: 61%; or
  • Financial wellness benefits/programs: 61%.

 

The findings come from a Voya Financial Consumer Insights & Research survey conducted June 12 and 13 on the Ipsos eNation Omnibus online platform among 1,004 U.S. adults aged 18 and older, including 483 working full-time or part-time, according to Voya.

 

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