Employees Want DB Plans

June 5, 2002 (PLANSPONSOR.com) - Though employers have added more defined contribution retirement plans, healthcare plans and disability insurance coverage to their benefits packages, unsatisfied employees are demanding defined benefit plans too, a survey finds.

According to the latest quarterly Well-Being Index report from Principal Financial Group, more workers reported fatter benefits packages. For example, in the latest quarter 97% of respondents said their companies provided health insurance, up from 89% a year ago.

Still, employees want additional benefits that are not being offered by their employer. According to The Principal, roughly 24% of respondents said they wanted defined benefit, or DB, plans, up from 19% a year ago.

At the same time, about 81% of employees said their companies offered defined contribution plans, compared with 76% a year ago.

Over the years defined benefit plans have fallen out of favor with employers, who complain that they are expensive to administer. However, the market slowdown has made it difficult for individuals to manage their own 401(k) accounts.

Future Facts

The survey also asked respondents to rank their top job-related concerns. Over half ranked job security first, ahead of “long-term financial future” and having “challenging work”.

Despite the concern over long-term finances, only 58% of respondents are planning for retirement, and only 44% are confident in ability to effectively transition their savings into a dependable stream of retirement income.

The survey was conducted online by Harris Interactive, which polled 1,500 employees at businesses with up to 1,000 workers.