A majority of Canadian employers believe providing workplace retirement savings plans can improve employee attraction and retention, according to a survey by Maru Group Ltd. on behalf of the Healthcare of Ontario Pension Plan.
The survey, which polled 800 Canadian employers, found 88 per cent of those that offer a defined benefit pension plan said it was “extremely important” or “very important” to their employee retention efforts, followed by 85 per cent of employers with a defined contribution plan and 83 per cent that provide a group registered retirement savings plan.
In terms of recruitment efforts, 87 per cent of respondents that offer a DC plan said it was “extremely important” or “very important,” followed by 83 per cent of those that provide a DB plan and 77 per cent of those with a group RRSP.
These figures are comparable to the recruitment rankings for pay (86 per cent), the work itself (82 per cent), wellness benefits (81 per cent), profit-sharing plans (81 per cent), work-life balance (80 per cent) and health insurance (78 per cent), but higher than those for dental insurance (74 per cent), disability insurance (74 per cent), life insurance (69 per cent) and upward mobility (62 per cent).
For retention efforts, the other top-ranked workplace offerings included pay (86 per cent), work-life balance (84 per cent), profit-sharing plans (84 per cent), health insurance (79 per cent), dental insurance (74 per cent), disability insurance and life insurance (72 per cent each, respectively), as well as upward mobility (66 per cent).
“Retirement benefits were the No. 1 most effective lever for recruitment and the No. 2 effective lever for retention,” said Alex Mazer, co-founder and chief executive officer of Common Wealth, while speaking during a webinar.
“Organizations that offer retirement plans really do have a competitive advantage,” said Rahima Mamdani, chief people officer at YMCA of Greater Toronto, who also spoke during the webinar. “As we’re starting recovery from the pandemic, we hear so much about businesses that are just not seeing as many qualified candidates — roles going unfilled, strong candidates being counter-offered by their employers to stay. . . . Anything that can be done to make a workplace more attractive is really important in this market.”
Additionally, survey respondents ranked workplace retirement plans among the top ways to reduce employees’ financial stress (85 per cent), which was comparable to pay and fringe benefits (84 per cent each, respectively) and above health insurance and wellness benefits (79 per cent each, respectively), disability insurance (73 per cent) and life insurance (72 per cent).
Of note, employers that offer retirement benefits were more likely to report improved productivity during the coronavirus pandemic (net increase of 38 per cent) compared with employers that aren’t offering any retirement benefits (net increase of seven per cent).
An increasing body of research is demonstrating a link between employees’ financial stress and productivity at work, noted Mazer, adding the employers also said retirement benefits were the No. 1 most effective tool for reducing employees’ financial stress because they’re helping people to save, build confidence and financial security and thus allowing them to focus on their day-to-day work.