New study: for many older employees, there isn't a Great Resignation, it's the Great Delay

Rhea-AI Summary

A recent Nationwide Retirement Institute survey reveals that the Great Resignation primarily affects workers aged 30-45, with older employees delaying retirement. Among participants aged 45 and older, 25% have postponed retirement due to the pandemic, rising to 30% for those 65 and older. Delayed retirements lead to negative emotions, impacting mental health (48%), morale (39%), and productivity (23%). Employers are encouraged to offer guaranteed lifetime income options, with 46% of participants expressing interest. Nationwide manages 34,000 retirement plans, protecting over $173.9 billion in assets.

Positive

• Survey highlights the need for employers to address delayed retirements to improve workplace morale.
• Increased interest in guaranteed lifetime income investment options among plan participants (46%).
• Nationwide manages a significant asset base ($173.9 billion) supporting retirement plans.

Negative

• Less than 25% of plan sponsors recognize the emotional impact of delayed retirements on employees.
• High levels of frustration (48%), worry (42%), and sadness (38%) reported by older employees regarding retirement delays.

COLUMBUS, Ohio, Nov. 8, 2021 /PRNewswire/ -- Today many companies are grappling with the Great Resignation, primarily with employees ages 30 to 45 years. However, a new Nationwide Retirement Institute® survey of retirement plan sponsors and participants uncovered the Great Resignation doesn't necessarily apply to older employees, with one in four employer-sponsored retirement plan participants ages 45 and older reporting that the pandemic has caused them to push back their retirement or prevented them from ever retiring at all. This is even higher for participants 65 years and older at 30%. On average, plan participants who say they will delay their retirement expect to work for at least three years later than they thought they would prior to the pandemic.

These delayed retirements have had a direct impact on these employees' happiness at work and likely business outcomes for their employers.

• Nearly half of surveyed plan participants (48%) report feeling frustrated
• 42% are worried
• 38% are sad 
• 17% feel hopeless

These emotions are bleeding into their work life, with plan participants indicating their delayed retirement has negatively impacted their mental health (48%), morale at work (39%), and productivity (23%). What may be more concerning is many companies aren't aware of these repercussions. Less than a quarter of plan sponsors surveyed have recognized these issues in their workplace.

"While many companies are focused on attracting and retaining talent during the Great Resignation, there is another group of their employee base that needs attention in order to transition out of the workforce," said Amelia Dunlap, vice president of Nationwide Retirement Solutions marketing. "It's clear delayed retirements can foster negative emotions, which can be detrimental to a company's culture and bottom line. Employers should look to invest in the short-term and long-term financial planning solutions that help employees reach their financial goals and prepare for the retirement they want, when they want it. Doing so may not only help those who are ready to retire, but potentially serve as a reason for younger talent to stay with the company."

One of the long-term planning solutions plan sponsors could consider to help employees retire on time is offering guaranteed lifetime income investment options for participants. In fact, about half (46%) of plan participants are interested in these options. Eighty-one percent of plan sponsors acknowledge their employees want this, too.

Forces causing older workers to consider delaying their retirement are driven by uncertainty in how their retirement savings will translate to retirement security. Half of participants are worried about market volatility (51%), managing lifestyle and expenses (50%) and outliving their income (48%) in retirement.

"With long-term financial security top of mind for employees, guaranteed lifetime income investment options within an employer sponsored defined contribution plan can help them grow their retirement savings with the confidence that they can generate income they won't outlive in retirement," continued Dunlap. "To get started, plan sponsors should work with their plan advisor or consultant to identify which option is right for their plan participants and benefits mix."

Nationwide offers a list of considerations to help plan sponsors, consultants and advisors get conversations about in-plan guarantees started, as well as additional resources for advisors and consultants.    

Nationwide Retirement Solutions administers nearly 34,000 retirement plans, protecting more than $173.9 billion in participant assets, and helping secure financial futures for more than 2.6 million participants in the governmental 457, corporate 401(k) and not-for-profit 403(b) markets. Nationwide is committed to serving the retirement industry by doing the right thing at the right time through better participant experiences, administrative simplicity and values that translate to service.

Methodology
Edelman Data and Intelligence (DxI) conducted the online survey on behalf of Nationwide July 19-August 4, 2021. Respondents included:

• 500 company plan sponsor, including business executives, business owners, human resources professionals, and financial management professionals who are full-time workers at U.S. businesses with at least 10 full-time employees. They must also be decision-makers for company retirement plans including 401(k), 403(b), or 457(b) plans.
• 300 financial advisors or consultants who advise at least one plan sponsor on investment decisions, financial planning, and options.
• 1,000 plan participants 45+ years of age who work full-time and have access to a 401(k), 403(b), or 457(b) plan through their employer.

As a member in good standing with The Insights Association as well as ESOMAR Edelman Data and Intelligence conducts all research in accordance with local, national and international laws as well as in line with all Market Research Standards and Guidelines.

About Nationwide
Nationwide, a Fortune 100 company based in Columbus, Ohio, is one of the largest and strongest diversified insurance and financial services organizations in the United States. Nationwide is rated A+ by both A.M. Best and Standard & Poor's. An industry leader in driving customer-focused innovation, Nationwide provides a full range of insurance and financial services products including auto, business, homeowners, farm and life insurance; public and private sector retirement plans, annuities and mutual funds; excess & surplus, specialty and surety; pet, motorcycle and boat insurance. For more information, visit www.nationwide.com. Follow us on Facebook and Twitter.

Contact:
Mike Switzer
SWITZEM1@nationwide.com 
614-370-0001

NFM-21468AO

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SOURCE Nationwide

FAQ

What did the Nationwide Retirement Institute survey reveal about older employees and retirement?

The survey found that one in four plan participants aged 45 and older delayed retirement due to the pandemic, with the number rising to 30% for those 65 and older.

How are delayed retirements impacting older employees' well-being?

Delayed retirements are causing negative emotions, with 48% of participants reporting adverse effects on their mental health, 39% on workplace morale, and 23% on productivity.

What percentage of plan participants expressed interest in guaranteed lifetime income options?

Approximately 46% of plan participants are interested in guaranteed lifetime income investment options to ensure retirement security.

What action is suggested for employers in response to the findings of the survey?

Employers are encouraged to invest in financial planning solutions that help employees prepare for retirement, addressing the needs of those delaying retirement.