Retiring Some Misconceptions

A new survey finds little common ground between workers and employers on the subject of pension and 401(k) plans

Sooner or later, when the downturn ends and unemployment recedes, small businesses could find themselves facing a once-familiar problem: How to attract talented employees when many larger outfits are offering 401(k) plans and comprehensive retirement packages? "When given a choice between two jobs -- one with a lower salary then expected but excellent retirement benefits and the other with a high salary but poor benefits -- workers continue to prefer the first option," says Catherine Collinson, senior vice-president Transamerica Center for Retirement Studies (TCRS).

That isn't mere speculation on Collinson's part, but one of the conclusions to be drawn from a TCRS poll of 300 small-business employers and 765 workers in a variety of industries. While health insurance remains the most desired benefit, the survey found that retirement plans run a close second -- and that more than half of the canvassed workers would leave their present jobs if offered positions with better retirement packages. The majority of entrepreneurs, however, don't see it that way.

According to the survey, 71% believe high salaries are what employees want most of all. Indeed, the gulf in perceptions becomes even more striking when employers try to imagine themselves in their workers' shoes: A stunning 72% believe employees prefer not to think about planning for their senior years until they are nearing retirement age. By contrast, only 29% of workers admitted giving little thought to their retirement. Obviously, even before the small-business community addresses the retirement issue, employers need to review their own perceptions and preconceptions.

By Alison Ogden in New York

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