Employee Benefits Suffer During the Recession
Prudential Financial Inc. has published a new study, which reveals the effects of the economy on employee benefits. A New Day in Employee Benefits, reveals that under 50% of benefit plan sponsors reported increased budgets from 2008, a dismal comparison to 60% of sponsors who experienced increases in 2007 and 2008. Additionally, 30% of companies have reported maintaining their 2008 budgets, while 15% have reported an average decrease of 16%.
“Employee benefits are crucial in uncertain times,” said Prudential President Lori High. “Plan sponsors need to ensure the benefits can be maintained”.
A New Day in Employee Benefits also delves into the experience of benefit plan participants and sponsors, providing insight into their plight. Prudential notes that these findings can help shape the future of employee benefits, helping employers prepare for annual enrollment and business planning.
The study has found that companies who have seen decreased income during the recessionary period are beginning to adjust their expectations of benefits staffing levels. They are considering downsizing their benefits over the next five years, to save money. However, such economizing is beginning to show signs of negative impacts on staff education.
While the results are currently grim, companies involved in the study have a positive outlook for the coming year. Plan sponsors predict that their companies will see improved income during 2010, a fact which will bear positive effects on their budgets for staff benefits.
A new report by Prudential has delved into the landscape of national staff benefits, revealing that it is suffering from the effects of the global recession.