Towers Watson Survey of Employees

By April 4, 2014Commentary

Towers Watson is another large employee benefits consulting firm.  Its annual Global Benefit Attitudes survey included over 4200 respondents working at companies with more than 1000 employees.   (Towers Survey)    The findings from this survey, as with the Mercer one described earlier this week, focused on retirement and health issues and the interaction between the two.  Overall, employee satisfaction with their financial situation has risen from 26% in 2009 to 46% in 2013, but most of the companies at which these employees work have implemented at least one action, such as raising health care premium contributions or conducting layoffs, which creates a sense of insecurity.  Sixty percent of respondents were concerned about their financial future, and those in poor health or without access to defined benefit retirement plans have the highest levels of concern.  Only 25% of employees are very confident about having enough income for the first 15 years of their retirement.  For obvious reasons, even fewer workers near retirement age have this level of confidence.  Most employees believe that social security and Medicare will be worth less and provide less benefits over the course of their retirement and the majority think their situation in retirement will be worse than their parents was.

Over half of the respondents are very concerned about being able to pay medical expenses when they retire and only 40% feel they are financially capable of handling medical expenses that might come up in the next year.  A significant majority of workers believe that there will be more health care cost sharing in their company in the future.  Older employees and those in poorer health understandably have the highest level of concern in regard to health care costs.  In the aftermath of the recession, many employees say they continue to reduce debt and limit spending, but they are not necessarily saving more for retirement, as incomes have not grown significantly in real terms.  Most workers say they know they need to save more for retirement, but a significant percent say they are simply unable to do so.  Consequently it is not surprising that many employees say they are likely to delay retirement beyond age 65, including many in poor health who may feel they need access to employment health benefits as well as Medicare.  The consistent picture painted by both surveys is that while some aspects of workers’ financial situations have improved, they have increasing levels of stress regarding the affordability of retirement and health care.

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