compensation, retirement and benefits trends report · 2018-01-25 · compensation, retirement and...
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COMPENSATION,
RETIREMENT AND BENEFITS
TRENDS REPORT
Troy Thomas, Senior Relationship Manager
Rena Somersan, Managing Principal, Compensation Consulting Services
2017/2018 EDITION
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Agenda
CRB Survey Demographics
Compensation Practices
Retirement Plans
Health and Welfare Benefits
Questions
Wrap-up
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DEMOGRAPHICS
2017/2018 Compensation, Retirement and Benefit Trends Report
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Demographics
Key Definitions
Northeast New England: Connecticut, Maine, Massachusetts,
New Hampshire, Rhode Island, and Vermont
Middle Atlantic: New Jersey, New York, and
Pennsylvania
Midwest East North Central: Illinois, Indiana, Michigan, Ohio,
and Wisconsin
West North Central: Iowa, Kansas, Minnesota,
Missouri, Nebraska, North Dakota, and South Dakota
South South Atlantic: Delaware, District of Columbia,
Florida, Georgia, Maryland, North Carolina,
South Carolina, Virginia, and West Virginia
East South Central: Alabama, Kentucky, Mississippi,
and Tennessee
West South Central: Arkansas, Louisiana, Oklahoma,
and Texas
West Mountain: Arizona, Colorado, Idaho, Montana,
Nevada, New Mexico, Utah, and Wyoming
Pacific: Alaska, California, Hawaii, Oregon,
and Washington
Note: Not all respondents provided demographic information.
35%
27%
17%
6%
15%
Full-Time Equivalent (FTE's)
<100
101-250
251-750
751-1500
>1500
18%
55%31%
27%
Location
Northeast
Midwest
South
West
N=297
N=289
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7%
2% 2% 2%
10%
2%
11%
5%
16% 16%
7%
2%
4%
3%
1%
11%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
Organizations by Industry
Demographics
N=295
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COMPENSATION
PRACTICES
2017/2018 Compensation, Retirement and Benefit Trends Report
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Total Compensation Philosophy
11%
19%
33%
25%
79%
57%
62%
67%
5%
6%
1%
1%
5%
19%
4%
7%
0% 20% 40% 60% 80% 100%
Base Salary
Incentive Compensation
Health & Welfare Benefits
Retirement Benefits
Position above market Position at market Position below market No formal philosophy
QUESTION: What is your organization’s total compensation philosophy
When considering which areas of the Total Compensation philosophy to differentiate, the greatest emphasis is placed on Health &
Welfare Benefits or Retirement Benefits to be at levels above the market.
N=164
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Salary Structure
QUESTION: Do you have a formal salary structure (i.e.,
ranges with a minimum and maximum) to manage
compensation across levels within the organization?
A slight majority of organizations utilize a formal salary
structure with grades (minimums, midpoints and
maximums) to manage compensation. The Healthcare
and Not-for-Profit industry sectors are far more likely than
other industry groups to have a formal salary structure to
manage their compensation investment, as are larger
organizations with more than 1500 employees.
N=299
57%
43%
Yes No
QUESTION: Do you have a formal salary structure (i.e., ranges with a minimum and maximum) to manage compensation
across levels within the organization?
Overall 100 or Fewer 101-250 251-750 751-1,500 1,500 or More
Yes 57% 37% 54% 76% 61% 84%
No 43% 63% 46% 24% 39% 16%
Base 299 100 79 49 18 43
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RETIREMENT PLANS
2017/2018 Compensation, Retirement and Benefit Trends Report
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Outside Advisor Involvement
QUESTION: How long have you been working with
the same outside advisor?
Over 55% of respondents have been working with the
same advisor for more than five years, with only 4%
reporting they do not work with an outside advisor.
55%
26%
6%
4%10%
More than five years
Between one and five years
One year or less
We don't work with an outside advisor
Don't know
N=299
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78%
71%
65%
17%
19%
53%
68%
2%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
Plan Design
Fee Analysis and Benchmarking
Investment advisor - co-fiduciary (ERISA 3(21))
Investment advisor with full decision making authority (ERISA 3(38))
Investment advisor who is not a fiduciary
Vendor Review and Monitoring
Participant Education
Other
Retirement Services with Outside Advisors
QUESTION: Please select the types of retirement plan services for which you engage an outside advisor. (Select all that apply)
In 2017, plan sponsors were relying most on assistance from third-party advisors for plan design, fee analysis and benchmarking
and for participant education.
N=234
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Evaluating Retirement Plan Services
QUESTION: Which of the following factors is MOST important in evaluating retirement plan offerings? (Please rate by level of
importance, with 1 being the most important and 6 being the least important)
In 2017, one-third of employers focused most on the level and quality of services offered. The cost of investments follow close
behind in importance to employers.
23%
16%
33%
5%
17%
11%
0% 5% 10% 15% 20% 25% 30% 35% 40%
Cost of Investments
Cost of Service
Level/Quality of Service
Number of Investment Options
Reputation of the Provider
Recommendation of Advisor
Note: can have multiple factors as "MOST" important.N=296
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16%
2%
5%
28%
49%
0% 10% 20% 30% 40% 50%
Yes, already use provider for 3(16) administrative fiduciary services
Yes, considering this for next year
Yes, considering this for future
No, and not considering for the future
Don't know
3(16) Administrative Fiduciary
QUESTION: Would the services of 3(16) administrative fiduciary be of interest to you?
In 2017, plan sponsors used a provider for 3(16) services in 16 percent of organizations with 5 percent considering for the future.
N=276
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91%
11%
2%
3%
10%
3%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Defined Contribution
Defined Benefit - Traditional
Defined Benefit - Hybrid
ESOP - Employee Contribution
ESOP - No Employee Contribution
Simple
Retirement Plan Options
QUESTION: What type of qualified retirement plan(s) do you offer?
The results of the 2017-2018 survey are consistent with past findings, showing the large majority (91%) of employers offer a defined
contribution plan.
N=285
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Retirement Plan Automatic Enrollment
QUESTION: Does your plan have an automatic enrollment feature?
Close to half (49 percent) reported that their plan currently has an automatic enrollment feature, with an additional 17 percent of
those not currently utilizing automatic enrollment either planning to add the feature next year, or considering it for the future.
49%
1%
16%
33%
0% 10% 20% 30% 40% 50% 60%
Yes
No, but planning to next year
No, but considering for the future
No, and not considering for the future
N=299
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Retirement Plan Automatic Enrollment by Industry
QUESTION: Does your plan have an automatic enrollment feature?
Overall
Manufacturing,
Distribution,
Utilities,
Technology, &
Transportation
Not-for-Profit,
Education, &
Government
Construction &
Real Estate
Other Services,
Professional
Services,
Restaurant, &
Retail
Finance,
Banking, &
Insurance Healthcare
Yes 49% 55% 43% 64% 40% 49% 64%
No, but planning to
next year1% 3% 2% 0% 0% 0% 0%
No, but considering for
the future16% 20% 28% 0% 13% 14% 9%
No, and not considering
for the future33% 22% 27% 36% 47% 37% 27%
Base 299 69 60 22 68 43 33
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Retirement Plan Automatic Escalation
QUESTION: If you have or are planning to add an automatic enrollment feature, will your auto enrollment include an automatic
escalation feature?
Slightly over one-third of respondents whose plans have an automatic enrollment feature, also have an automatic escalation feature
(38 percent) with over 22 percent considering for the future.
38%
1%
22%
41%
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
Plan has automatic escalation
No, but planning to add next year
No, but considering for the future
No, not considering for the future
N=200
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Retirement Plan Automatic Enrollment
and Escalation Benefits
QUESTION: If "yes" for automatic enrollment and/or
automatic escalation, how effective have these features been
in increasing participation and savings?
When evaluating the benefits of automatic enrollment and
escalation approximately 90% of organizations found those
actions to benefit participation and savings.
60%
30%
5%
4%
Highly Somewhat
Not Very Not at all
N=73
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Retirement Plan Matching Contributions
QUESTION: Does your company offer matching contributions?
Over three-quarters of organizations currently offer matching contributions. An additional 3 percent reported they are considering
adding one in the future.
77%
9%
0%
3%
17%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
Yes, qualified
Yes, non-qualified
No, but planning to next year
No, but considering for the future
No, and not considering for the future
N=289
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Retirement Plan Contribution
QUESTION: How does the projected retirement plan contribution compare to last year? (Please select one)
The large majority (80%) of employers project their retirement plan contribution will remain the same as the previous year. Across
all sizes of organizations and industries though, approximately 14% of employers expect to increase their contribution as compared
to the previous year.
80%
14%
2%
0%
3%
1%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
Staying the Same
Increasing
Decreasing
Suspending
Do not match
Do not have a plan
N=287
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33%
67%
Yes No
Non-Qualified Deferred
Compensation Plans
QUESTION: Do you offer a Non-Qualified Deferred
Compensation, Non-Qualified Benefit, or other Key
Person benefit plan?
One-third (33%) currently offer a non-qualified
deferred compensation or benefit program to their
employees. This is a significant increase over last
year when only 24% of companies where offering
non-qualified plans.
Note that use increases significantly and percentages
essentially reverse as organization size grows, with
prevalence at 72% when size exceeds 1,500 FTE’s.
This increase in percentage is consistent with our
non-qualified survey which indicates that 92% of
Fortune 1,500 caliber companies offer deferred
compensation plans.
N=299
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HEALTH AND
WELFARE BENEFITS
2017/2018 Compensation, Retirement and Benefit Trends Report
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Financial Wellness Programs
QUESTION: Has your company implemented "financial wellness" (financial literacy and education) programs to help employees
prepare for current and future financial needs—whether separately or as part of the overall health and wellness program?
Approximately one-third of organizations (44 percent) have implemented a financial wellness program to help employees prepare for
current and future financial needs with another 26 percent planning to implement financial wellness programs.
44%
26%
29%
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
Yes, have already implemented
No, but planning to implement
No, no plans to implement
N=289
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QUESTION: Do you offer targeted communications and support for participants by age or life stage? (Select all that apply)
Targeted Communications by Life Stage by FTE’s
Overall 100 or Fewer 101-250 251-750 751-1,500 1,500 or More
Starting out (20-30) 24% 15% 22% 28% 24% 44%
Mid-Career (30-50) 24% 15% 22% 30% 24% 47%
Nearing Retirement (50+) 25% 13% 24% 30% 29% 53%
In Retirement (60+) 13% 9% 13% 13% 24% 23%
We don't offer targeted communication
and support by age or life stage. 72% 84% 74% 68% 71% 44%
Base 289 96 76 47 17 43
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Financial Wellness Program Communication Methods
QUESTION: What is the most effective way to communicate to your employees? (Select all that apply)
While there are a wide variety of methods utilized, the most popular method to communicate and educate on financial wellness has
been onsite meetings with 68 percent and personalized electronic materials for 41 percent.
68%
38%
29%
41%
34%
40%
0%
10%
20%
30%
40%
50%
60%
70%
Onsite groupmeetings
Onsite one on onemeetings
Personalized printmaterials
Personalizedelectronic materials
Generic electronicmaterials
Web-basedinformation
N=289
Questions?
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