Morneau Shepell’s 30th annual Compensation – Trends and Projections survey results found that pension plan sponsors intend to get more serious about pension and benefits costs next year.
For sponsors of DB pension plans, the key priority is to rein in escalating pension costs. With interest rates remaining at historical lows, these sponsors are increasingly implementing liability-driven, investing strategies. And as a response to exploding pension costs, employers are looking into all available alternatives to modify pension cost sharing and risk.
For sponsors of DC plans, the trend is to establish a realistic retirement income scenario. In addition to retirement income calculators and other decision tools, plan sponsors are turning more to presenting members with personalized scenarios to make them aware of the adjustments they may need to make to their retirement savings strategy.
Survey respondents offering benefits programs indicate that cost control and disability management were will be top priorities for 2013 for their benefits programs. Faced with continuing cost increases and higher utilization rates for expensive drugs, employers are increasingly seeking the help of outside consultants to find cost-control strategies without that don’t require a reduction in access to medical therapies for employees.
The survey was conducted between mid-June and mid-August 2012. More than 250 organizations took part, collectively employing one million people in Canada. from the majority of employer respondents came from the manufacturing (28%), services (24%) and finance (14%) sectors.