Defined contribution plan sponsors are often concerned their members aren’t taking full advantage of the pension offering and can wonder why their communications strategies don’t seem to work.
In the opening keynote at Benefits Canada‘s 2020 DC Plan Summit in Montreal in February, Nik Nanos, chief data scientist and president of Nanos Research, highlighted the importance of distinguishing between literal and symbolic messaging.
People who interpret things symbolically aren’t interested in learning about the facts, he said, so why continue with evidence-based and literal messaging? How do DC plans reach the people who’ll never take the time to read the fine print?
“[In your plan], there will be people that you help who are interested in the narrowest details . . . and you need to communicate with them and they’re very important. But there are other people who just want to trust that everything will be there when they need it, and you need to think about how you communicate to both types of individuals because they have different communications needs.
“So yes, you need the big long bulletin that explains the best practice. But there also needs to be someone who explains things to people so they believe that what they need in the future will be there.”
Nanos also noted the importance of choosing the right words. Surveys showed Canadians were overall more confident in their future standard of living in 2012 under then prime minister Stephen Harper than during Prime Minister Justin Trudeau’s first term, he said, noting part of the reason for this was the Harper Conservatives’ prosperity narrative, compared to the Trudeau Liberals’ focus on an innovation economy.
“What does ‘innovate’ mean?” he asked. “Whenever you talk about the innovation economy, you’re creating anxiety as people don’t know how to participate in that and see the threats from technology, for example. Why not, instead, say you need to be agile and flexible?”
Nanos also shared his thoughts on populism, explaining that people’s perception of being part of the middle class was a useful frame for examining the current situation.
In the 1950s, people believed a high school diploma was required to achieve a middle-class existence, whereas today it’s a college or university education, he said. But for many, that still isn’t enough.
“People are doing everything they are told to do. They are doing everything right,” said Nanos. “They work hard through college and university to get the middle-class existence. . . . But as soon as they step out of school, they struggle to pay their bills or can’t build a nest egg or worry about their retirement. They are struggling to start off, as opposed to [their] parents who could save and had a more positive and stable view.”
The irony is that eight out of 10 Canadians self-identify as middle class, he noted, meaning there are high-income Canadians who feel they are “just getting along.”
“These are people who, on paper, are comfortable, but who don’t feel as comfortable as their finances suggest — what I call ‘joyless prosperity.’ Unemployment is at an all-time low, all the macro numbers are high. But people don’t perceive the economy is as strong as the numbers suggests. Psychologically, it just doesn’t connect with how they feel.”
Read more stories from the 2020 DC Plan Summit.