Break from the Grind August 1, 2017

Job Candidates Care About Employer Reputation

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Negative publicity not only damages a company’s brand, but also its ability to recruit talent, according to a CareerBuilder survey.

Seventy-one percent of U.S. workers say they would not apply to a company experiencing negative press. Female workers are much more likely not to apply to a company experiencing negative press than their male counterparts, 79% compared to 61%, respectively.

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Bad publicity can have a serious ripple effect across companies. More than one-quarter of employers (26%) say their company has experienced negative publicity, resulting in a hit to their hiring process. Sixty-one percent of these employers combined report fewer job offers being accepted, fewer candidate referrals from employees and fewer job applications as a result of the negative publicity. Other negative impacts to the business included lower employee morale, higher voluntary employee turnover and a decline in sales.

Bad publicity may turn off candidates from applying—but it rarely deters current workers from leaving their jobs. Less than one in 10 workers (6%) have left a company because of negative publicity.

On the other hand, employers who have experienced positive press have seen beneficial impacts such as:

  • Higher morale among employees (42%);
  • Employees were most likely to share positive things about the company on social channels (36%);
  • Boost in sales (36%);
  • More job applications (32%);
  • More job candidate referrals from employees (22%);
  • More job offers being accepted (21%); and
  • Lower voluntary employee turnover (19%).
The survey was conducted online within the U.S. by Harris Poll on behalf of CareerBuilder among 2,369 hiring and human resource managers ages 18 and older (employed full-time, not self-employed, non-government) and 3,462 employees ages 18 and older (employed full-time, not self-employed, non-government) between May 24 and June 16, 2017.
Data and Research August 1, 2017

Financial Shocks Hurt Americans' Retirement Savings

A research report says health crises, job losses or other life transitions lead retirement plan participants to pull money from their accounts or discontinue contributing.
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Ninety-six percent of Americans experience four or more income disruptions—a reduction of 10% or more of their income due to health crises, job losses or other life transitions such as divorce—by the time they are 70, according to new research from The New School, commissioned by the National Endowment for Financial Education (NEFE).

This is one of the reasons why Americans are not saving enough for retirement, according to The New School. In fact, Americans on average are only saving about one-third of the amount they will need to maintain their living standards in retirement, according to NEFE.

“The story is more nuanced than simply saying Americans are failing at retirement savings,” says Ted Beck, president and CEO of the National Endowment for Financial Education. “No one likes to believe that income shocks will happen to them. Yet this research shows that it is not a matter of if something will disrupt earnings, but when and how severe the effects of such shocks will be.”

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The study also found that men between the ages of 55 and 61 have $11,000 to $47,334 more in retirement savings than their younger counterparts. The range depends on their income level. The study also found that African-American workers have, on average, $16,977 less saved than their white counterparts, while Asians have $11,743 to $41,979 less saved and Hispanics have $8,280 to $24,278 less.

Those in the middle- and lower-income groups are more likely to experience economic shocks from job loss or poor health, and they are more negatively affected by these earnings losses.

The most negative impacts on income disruption are due to a decline in health, including long-term illness and a disability that impedes a worker’s ability to perform their job. When workers face such challenges, The New School says, they often withdraw money from their retirement accounts and/or stop contributing to the accounts. As the report’s executive summary notes, “Retirement plans often are treated as liquid savings during times of hardship. In fact, economic shocks explain at least 32% of withdrawals by workers in low-income households, and possibly considerably more.”

The National Endowment for Financial Education recommends that employers encourage workers to build an emergency savings account. The executive summary of the report, “Income Shocks and Life Events: Why Retirement Savings Fall Short,” can be downloaded here.

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