Many higher education institutions will likely use the defined contribution plan their organization offers as an enticement for attracting workers and to help alleviate staffing pressures, survey data from Voya Financial shows.
Higher education plan sponsors identified attracting and retaining staff as their greatest current challenge. The Voya survey shows that 80% of respondents agree that attracting and retaining high-quality administrators is much more important today than it was pre-pandemic, the Voya 2022 Higher Education Study finds.
Among survey respondents, 90% of higher education plan sponsors agree their defined contribution plan can help to attract talented workers, 87% say an organization’s defined contribution plan helps retain good employees and 50% of institutions report starting or increasing the employer match to the retirement plan since January 1, 2021, the survey finds.
“The ability to attract and retain top talent has been a challenge facing many industries, but for those in the higher education sector, it has only been exacerbated by the pandemic,” says Brodie Wood, vice president and national practice leader for the education market at Voya, in a press release.
A specific challenge for higher education plan sponsors is that many employees want a hybrid work model, added Wood.
“When you consider today’s job market with more competition for companies to find staff in general, in most cases, higher ed[ucation] institutions are not able to compete with the benefit of flexibility that many jobs outside the sector offer today—such as the desire to work completely remotely, which many colleges and universities do not allow,” he says.
The Voya survey identified the following as the most important benefits for attracting talent:
- A defined contribution retirement plan.
- A paid leave benefits program.
- A defined benefit pension.
The Voya survey also reveals that higher education sponsors are grappling with how to best support employees with retirement planning.
A Voya spokesperson added that higher education plan sponsors’ specific recruitment and retainment challenges include a tight overall labor market with more competition for staff; the pandemic leading some people to rethink the role of work in their lives; a desire of many to work completely remotely, which many colleges and universities do not allow; salaries at educational institutions being generally lower than in the private sector; and some colleges are in a rural location, which can cause additional challenges such as drawing from a limited work pool.
Voya research finds widespread agreement among plan sponsors that many employees are facing several challenges to their ability to save for retirement including caregiver responsibilities at 87%, student loan debt at 85% and the impacts of inflation at 84%.
Some plan sponsors are addressing these challenges through wellness programs. Among respondents, 49% are addressing challenges to save through student loan repayment and 42% with financial planning resources for caregivers and employees with special needs and disabilities, the survey shows.
Additionally, 83% agree that matching student loan payments with a retirement plan contribution is more important now that it was before the pandemic, the survey finds.
The research was conducted by Greenwald Research on behalf of Voya. The biennial study included an online survey conducted June 29 to July 19, among 301 retirement plan decision-makers from higher education organizations, along with in-depth interviews among a select group of decision-makers conducted in August.
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