More than half (52%) of UK small and medium-sized enterprises (SMEs) are concerned that employees are not fully engaged with their workplace pension, according to research from UK master trust People’s Pension.
Nearly six in 10 SMEs, or 59%, said they are worried employees do not fully understand the value of their pension as part of their overall reward package. More than six in 10 (62%) fear financial pressure could result in higher opt-out rates.
The research also found that communication is seen as key to improving engagement. A quarter of employers, 26%, said they would like to see regular education sessions, webinars or workshops delivered by their pension provider, while 49% said providers do not communicate as effectively as they could.
At the same time, 82% of SME decision-makers said it is their responsibility to help employees put a financial plan in place for retirement, even amid cost pressures.
Almost half of the employers, 45%, said improved communication would help strengthen both engagement and retention.
Stuart Reid, distribution director at People’s Pension, said: “[…] employers increasingly recognise that their role doesn’t stop at simply providing a pension – they want to help their employees understand and engage with it.”
But he said that while employers and providers continue to improve how pensions are delivered and communicated, greater engagement from employees themselves will be “key to turning participation into meaningful long-term outcomes”.
