Why Retirement Benefits Are Critical To Closing Talent Gaps
If you're having trouble attracting or retaining top talent for your business, retirement benefits could be the key to closing your company's talent gap. In a recent study from the Employee Benefits Research Institute, just 22 percent of Americans said they were confident they'll be financially ready for retirement. The Bureau of Labor Statistics (BLS) estimates that just 66 percent of American workers have access to retirement benefits through their employers and that lower paid employees are more likely to have no access at all. Here's a closer look at why retirement benefits are important to job candidates and how to use them strategically in your recruiting.
Understand the Broader Context
Think about retirement in today's economic context, from the average employee's perspective. Workers from America's largest generation, the baby boomers, are reaching retirement age, and many don't have enough saved for retirement. Individuals from other generations are witnessing the effects of this firsthand: financial crises, retirements that don't live up to expectations, and more. Younger generations have struggled financially with student loan debt, the housing bubble, and the recent recession; as a result, many have been unable to save a substantial amount of money toward retirement. Concerns continue about the long-term viability of Social Security. Available retirement benefits are therefore a larger consideration for individuals looking for new jobs and working toward a secure financial future.
Retirement Benefits as Part of Total Compensation
Prospective candidates pay significant attention to compensation. Compensation doesn't stop with salary and bonus potential. Benefits are a core part of understanding a company's total compensation offer. Candidates often begin by confirming whether your company offers retirement benefits. What kind of program is offered? Who manages the plan? What investment options are available? Does your plan include managed funds that simplify saving for retirement by automatically distributing and adjusting risk according to planned retirement dates? Finally, does your company offer any type of matching program for employees who are saving for retirement? Consider each of these points and make sure that they are effectively communicated to prospective candidates and individuals receiving job offers.
Is It Worth Implementing a Retirement Plan?
If your company doesn't currently offer a retirement plan, it's worth investigating your options. In some cases, your payroll company or managed benefits provider can administer a 401(k) plan or other employer-managed retirement plan. Understand the costs associated with setting up a plan, arranging for employee contributions, and handling ongoing administration. Should you decide that a corporate 401(k) plan isn't right for you, look into "my Retirement Account" (myRA). This retirement option is a new government-sponsored initiative that can be offered to employees at no cost to the employer. The plan has limitations, but a myRA can be a way to get started with offering your employees access to tools that help them save for retirement.
Benefits, including retirement plans, are a major differentiator for candidates in the job market and help companies attract the top performers needed to close their talent gaps. Make the most of this opportunity by evaluating your current retirement offerings; if you don't have a plan in place, consider whether you need to start one. If you already have a plan in place, make sure it does a good job balancing the needs of your employees and your business.