A Better 401(K) Is the Top Reason Why Workers Switch Jobs

Most employees are still struggling in the aftermath of the Covid-19 crisis Many people work from home and they face debts and difficult financial positions. Emergency funds are almost empty and employees need some kinds of financial benefits to stay satisfied at work. 

To provide financial support, many employers think about 401K retirement plans and student loans. These employee benefits would increase the happiness at work and it would produce a better performance of the current employees. 

The Great Resignation is a difficult situation nowadays. People leave their workplaces because they are not satisfied with the retirement plan or they find better conditions somewhere else. In the times when many employees leave their work, the employers need to think about financial benefits that can make people stay at work. 

According to a study by Betterment, organizations need to consider alternative methods of offering financial benefits to keep their workforce. In September 2021, more than 4.4 million Americans quit their job, and this is a new record when it comes to resignation from work. 

These resignations are the result of the uncertainty that comes with future plans for retirement and overall benefits. Employees are not sure if they will have enough funds to support their retirement plans and have security in the future. During Covid-19,  the workers were faced with healthcare issues and social security issues. They wanted more stability and that is why they decided to work for the companies that offer the benefits. 

401(k) retirement plans

Many workers had to tap into their emergency funds when the pandemic started, and this situation is still current. People try to solve their financial issues by reaching for emergency funds, which is why the insecurity rises every time they need to reach for the new money. 

The pandemic also brought many concerns about retirement costs. Employees who are close to retirement are concerned about their financial status when they reach the retirement years. They worry if they will be able to support their lifestyle with the pension and if the retirement costs will be close to normal. 

On the other hand,  we have students whose student loans are still unpaid. There are huge debts in this area and students are concerned about their loans that are high. Workers want to make sure that their companies offer support in paying off their debts, which is why companies are forced to give more options when it comes to student loan payoffs.

In a study by Betterment, it is said that 74% of responders said they would leave the current company if the other company offered them better financial benefits. They would leave if the retirement plans were better, and this is a sign of the current situation at the companies. 

People are no longer tied to the companies and they search for the benefits that can offer them a more secure future. It is a win-win situation for the companies that have budgets to support retirement plans and student loans. These companies can attract many workers who are willing to work and are skillful in the selected industries. 

Also, 43% of responders said that they needed to use the emergency funds during the pandemic to cover their costs of living. This is a huge problem for many people, which is why many of them wanted to change the companies they worked for. Companies need to consider improved employee benefits if they want to stop people from leaving their companies. 

We witnessed huge challenges during the pandemic, and it is left to see how these issues will be resolved in the future. For now, the companies need to consider better retirement benefits and more solutions for student loans.

Diana Coker
Diana Coker is a staff writer at The HR Digest, based in New York. She also reports for brands like Technowize. Diana covers HR news, corporate culture, employee benefits, compensation, and leadership. She loves writing HR success stories of individuals who inspire the world. She’s keen on political science and entertains her readers by covering usual workplace tactics.

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