Employers and Workers are Aligned on Benefits—But Communication Gaps Undermine Financial Confidence
A new report finds employers and employees are aligned on priorities—higher pay, stronger retirement benefits and long-term financial security—but a lack of clear communication is limiting employee confidence.
Employers are expanding benefits, flexibility and technology, yet many workers remain uncertain about their financial future because of the communication gap.
That’s a key finding from the sixth annual Voice of the American Workplace Survey, released recently by Franklin Templeton.
“Employers are investing more than ever but employees need simpler, more actionable guidance to turn those benefits into real financial confidence.”
Franklin Templeton’s Steve McKay
“What this research shows is not a lack of effort, but a lack of clarity,” said Steve McKay, Head of U.S. Retirement, Insurance and College Savings, Franklin Templeton. “Employers are investing more than ever but employees need simpler, more actionable guidance to turn those benefits into real financial confidence.”
To wit, the survey found 88% of workers want benefits explained in plain language, and 53% feel overwhelmed by benefit choices. The disconnect is not priorities, rather it is communication. When benefits are too complex or technical, employees struggle to act on them.
“Employees want benefits that are relevant, personalized and easy to understand,” said Mike Dullaghan, Director of Retirement Sales Execution, Franklin Templeton. “Communication is critical to helping them make confident financial decisions and we’re committed to being part of the solution.”
The findings also show how workers are now prioritizing job stability over advancement. 72% of workers surveyed say job security matters more than higher pay, while more than half (52%) say it’s harder to move up or earn a raise. Meanwhile, the expected retirement age has risen to 59, up 4 years from 2023.
As financial pressures grow (81% of employers say they need benefit budgets to increase significantly in the next 12 months), employers are increasingly becoming the front line for employee financial wellbeing, supporting everything from retirement readiness to day-to-day financial stress.
Employers say they are facing increasing pressure on talent, costs and complexity. Two in three employers (67%) say attracting talent is harder than retaining it. 68% say benefits have become more complex, and 88% prioritize reducing employee financial stress.
The opportunity: Turn alignment into action
Employers and employees agree that pay, retirement benefits and long-term income solutions are where investments can be made to create a clear path forward. Both groups prioritize increasing pay, boosting 401(k) matches (49% are now maximizing the match, up from 38%) and investing in guaranteed retirement income solutions.
To close the gap, employers should:
• Simplify benefit design and communication
• Focus on clear, actionable guidance
• Personalize solutions to employee needs
Employers can also take immediate steps by reassessing how benefits are communicated and ensuring investment options such as target date strategies and capital preservation solutions reflect today’s market conditions. Notably, 91% of employees in the survey say they want more personalized retirement investment options.
The survey concludes that organizations that prioritize clarity over complexity have an opportunity to build trust, improve engagement and deliver better financial outcomes.
Access Franklin Templeton’s Voice of the American Workplace survey here.
SEE ALSO:
• Retirement Delayed as Workers Tap Savings, Cut 401(k) Contributions
• Health Risks a Bigger Threat to Retirement Security than Market Fears
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.