Pensions & employee benefits roundup - February 2017
Sometimes a quirky headline will grab your attention and the research from Aviva at the end of January certainly did this. Its recent survey found that more adults could identify the capital of Peru than correctly provide the definition of certain pension terms.
Being a geographer (and a fan of Paddington Bear) meant the capital of Peru didn’t trouble me too much, but it is perfectly understandable how so many people may get stuck with the pension definitions – just 22% could identify what income drawdown meant and 16% could identify what an enhanced annuity was. Our own research found that just under half (48.7%) of employees found pensions-related terminology to be complicated and confusing.
For many of us with some time before retirement, income drawdown and enhanced annuities will hold little relevance (at least for the time being). But Aviva also found that just 22% knew what a defined contribution (DC) scheme might be. Considering that 34.3% of employees are now actively contributing into a DC pension scheme of some sort (and that DC has now overtaken DB in terms of active members), this is a little worrying.
DC is different to DB. People in a DC scheme may not realise that so much of the risk now falls on them and passively saving for retirement may bring a nasty shock when it comes to drawing out your money at retirement. It’s so important for DC members in particular to get a good understanding of how the scheme works – because members can have a big impact on what they get at retirement.
Throughout the month our research team keep a close eye on what is happening in the pensions and employee benefits industries. Here is a roundup of the best news articles and stories for January 2017.
62% are unsatisfied with their benefits package
Employee Benefits, 6 January
Almost two thirds (62%) of employee respondents are unsatisfied with their benefits package, according to research by GCS Recruitment.
ONS: Boom decade for pensioners as workers stay poorer
Corporate Adviser, 10 January
Pensioners have seen their incomes increase by 13 per cent over the last decade, while non-retired households have suffered a 1.2 per cent real terms fall, new figures from the ONS show.
Employees ‘open to wearable monitoring at work’
Corporate Adviser, 11 January
More than half of British workers would monitor their health with technology at work if their employer supplied a device to do so, but only 5 per cent have already been given health tech, new research has found.
25% believe money worries affect their ability to do their job
Employee Benefits, 11 January
A quarter (25%) of employee respondents with money problems feel that this affects their ability to do their job, according to research by the Chartered Institute of Personnel and Development (CIPD) and Close Brothers Asset Management.
55% will stay with an employer due to pensions provision
Employee Benefits, 12 January
More than half (55%) of respondents who receive a workplace pension that will provide them with a comfortable retirement income say this is a key reason to stay with their current employer rather than look for a new position, according to research by Reed.
Three-quarters of employees crave more freedom at work
CIPD, 13 January
Ahead of Blue Monday next week – the so-called most depressing day of the year – a study by the ILM has found that more than half (53 per cent) of employees would consider leaving their job if the structure and culture of their organisation didn't change.
Almost three-quarters of dads want more flexible working
CIPD, 16 January
Unsympathetic employers that don’t offer flexible working options means many working dads are facing a ‘fatherhood penalty’ if they want to take part in family life more fully, warns new research from Working Families and Bright Horizons.
One in three pension schemes suffers fraud finds RSM
Pensions World, 16 January
Nearly one in three pension schemes has been affected by fraud, with victims experiencing a threefold rise in scams in the last 12 months alone, according to the latest RSM survey.
UK labour market: January 2017
ONS, 18 January
There were 31.80 million people in work, little changed compared with June to August 2016 but 294,000 more than for a year earlier. There were 23.25 million people working full-time, 209,000 more than for a year earlier. There were 8.55 million people working part-time, 86,000 more than for a year earlier.
George Osborne ‘to join BlackRock’
Corporate Adviser, 20 January
Sky News is reporting that Osborne is set to take a position with the BlackRock Investment Institute, a move that would see him reunited with his former economic adviser Rupert Harrison.
Recognition linked to higher engagement
HR Magazine, 24 January
The report, seen exclusively by HR magazine, surveyed 3,400 professionals globally (including 406 from the UK) and found that the 86% of UK employees who ‘always’ give recognition are highly motivated.
63% believe economic impact of Brexit will drive financial education demand
Employee Benefits, 25 January
Almost two thirds (63%) of employer respondents think that the impact of Brexit on the UK economy will drive demand for financial education in the workplace, according to research by Nudge.
Consumers 'more familiar with capital of Peru' than pension terms
Professional Adviser, 31 January
According to the firm, about 43% of UK adults could identify the capital of Peru but only half that amount could identify the correct definition of a defined contribution pension (22%), income drawdown (22%) or an enhanced annuity (16%).
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