Plan sponsors are increasingly using robotics or artificial intelligence (AI) in the workforce, along with target-date funds (TDFs) and education on Social Security benefits.
According to Transamerica’s latest study, “New Frontiers: Employers and the Evolving Workforce,” 72% of employers acknowledge they use robotics or AI in the workplace. Still, close to half (42%) of respondents say their workers are fearful over AI’s impact to their careers.
Employers who currently use or are planning to incorporate AI or robotics admit that using the technology could influence job roles. Nine in 10 (92%) of plan sponsors cite one or more implications for their workforce such as the transformation of certain jobs (68%), creation of new jobs (53%), and elimination of certain jobs (35%).
“AI, robotics, and other advanced technologies can boost productivity and revolutionize business models,” said Catherina Collinson, CEO and president of Transamerica Institute and the Transamerica Center for Retirement Studies (TCRS). “But these technologies can only be as effective as employers’ commitment to upskill and evolve their workforce accordingly.”
Despite their workers’ skepticism, employers say they are enhancing benefit offerings to appease recruitment and retention in their workplace. According to the findings, 53% say compensation and innovative benefit offerings are a top workforce management priority, while 46% say the same for employee recruitment and retention and 44% list talent development as key priorities.
Among the top employee benefits include health insurance (65%), followed by a 401(k) or similar plan (60%), life insurance (43%), student loan benefits (41%), a workplace wellness program (34%), an employee assistance program (33%), and a financial wellness program (32%).
Professionally managed investment services, such as personalized target date funds (TDFs), managed accounts, model portfolios, and asset allocation suites, including target date and target risk funds, have become extremely prevalent in 401(k) plans, Transamerica reports. Almost all (96%) of plan sponsors say they offer one or more types of these funds.
To increase recruitment and retention, Transamerica urges plan sponsors to consider boosting their workplace retirement benefits, especially as the SECURE 2.0 Act offers provisions to help employers enhance benefits. This includes provisions aimed at reducing student loan debt and maximizing emergency savings.
Providing education on future retirement income, such as Social Security benefits, could further help employees with limited knowledge on the agency. Eight in 10 (82%) of plan sponsors say they provide information about Social Security, including small, medium, and large companies (80%, 88%, and 85%, respectively).
A slightly larger number (86%) of plan sponsors offer communications about Medicare benefits, with small, medium, and large companies also likely to do so (86%, 87%, and 85%, respectively).
“Employers are main drivers of our economy and societal values. They enhance the lives of workers by offering employment, work experience, training and development, and valuable benefits to help them build wealth and achieve a financially secure retirement,” said Collinson. “At the same time, workers are an essential resource needed by employers to survive and thrive. Without doubt, in today’s dynamic environment, the workforce is evolving and both employers and workers must adapt accordingly. The future of work – and retirement – depends on everyone’s efforts.”
Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with nearly a decade of experience and a passion for telling stories and reporting news. She is originally from Queens, New York, but now resides in Denver, Colorado.