47 believe pension freedoms have increased employee engagement

first_imgUnder half (47%) of employer respondents believe that pension freedoms have led to employees being more engaged with their workplace pension, according to research by the Confederation of British Industry (CBI) and Aegon.Its survey of 189 employers also found that 59% of respondents feel that employees diverting money away from their pension due to other financial priorities is a principle barrier to employees’ engagement with their pension , compared to a further 59% who cite a lack of awareness among employees of the importance of retirement saving as the main barrier to employee engagement with pensions.The research also found:66% of respondents educate employees about the benefits of saving through a workplace pension in order to influence employee engagement with pensions. Other measures respondents believe can increase employee engagement with workplace pensions include wider financial education (58%), simpler language and less jargon in pensions communications (63%), using technology (54%) and individualising pensions communications (49%).24% of respondents feel that challenges around having insufficient resources to communicate to employees about pensions is a key barrier to employee engagement with pensions.92% of respondents contribute above the statutory auto-enrolment minimum levels.63% of respondents include pensions information as part of the employee induction process, 60% use guidance from an external provider and 54% signpost staff to publicly available pensions guidance.51% of respondents provide a digital pensions information portal for employees and 49% deliver in-house webinars or seminars.42% of respondents state that pension provision has had a positive impact on employee retention.12% of respondents are happy with their current levels of employee engagement and 55% think that stronger engagement would improve their ability to either retain, recruit or carry out succession planning.Neil Carberry (pictured), managing director at the CBI, said: “Businesses are contributing billions to their [employees’] pensions each and every year, playing their part in a quiet pensions revolution with auto-enrolment having a growing influence over workplace saving.“While many businesses rightly recognise the positive effect that their investment in pensions can have on recruiting and retaining staff, others need to open their eyes to grasp the opportunities in front of them. Engaging better with workforce on pensions is not a ‘nice-to-have’ but absolutely fundamental to the success of workplace pensions schemes and well-funded retirements for [employees].“Although many [organisations] do a great job, there’s an awful lot more that can be done to get staff engaged in their financial futures and to gain a better grasp of retirement planning. Many younger [employees], those on lower incomes and employees who have been at a business for a short period are not getting the support they need to get to grips with issues that will help determine a successful path to when they retire.“Businesses are up for the challenge, nine in ten [organisations] we talked to felt a responsibility to better engage employees with their pension schemes. Some businesses are already leading the way, over half have a strategy in place for securing greater pensions engagement.”Paul Bucksey, managing director at Aegon Workplace Investing, added: “Pensions are a big financial commitment for employers but this investment often goes underappreciated. A workplace pension is part of an employee pay package.“The challenge is for businesses to help their employees recognise this. Engagement is the key to changing behaviours and helping employees achieve long term financial security. When an employer gets behind their scheme and encourages the workforce to take action, engagement levels rise.“Some employers are already going the extra mile to support their workforce in getting their pensions on the right track. But what remains clear is that whether [they] choose to hold roadshows, workshops or webinars, offer online financial planning tools or workplace financial advice, [they] need to do it regularly, as part of a wider financial awareness strategy.“From recruitment to retirement, long-term planning and regular action will help employees reach a point where they can afford to retire. Ultimately, a workforce that can’t afford to retire presents employers with some new challenges around succession planning and managing an aging workforce. Better pension engagement from employees will help [employers] plan ahead to continue to grow and adapt [their] business.”last_img read more