Nearly 40% of employees in defined benefit (DB) pension schemes would be reluctant to move to a new job for fear of damaging their retirement savings, according to research by pensions risk transfer provider MetLife Assurance.
More than six out of 10 workers would be deterred from moving jobs to an employer offering inferior pension benefits, while 26% would not move jobs and 36% would only move if their salary increased by 10% or more.
The research also found that 61% of employees are expecting to have to work past 65, though just 35% expressed a desire to do so. Meanwhile, 27% of 55-to 64-year-olds said they had postponed plans for retirement due to falls in their pension savings over the past three years.
Emma Watkins, director of business development at MetLife Assurance, said: “It is very encouraging to learn the level of importance people are placing on their pension savings as demonstrated by the reluctance to move jobs if the pension provision at their new employer is inferior.
“That gives a clear message to employers of the importance and quality of pensions in recruitment and retention of staff.
“The trend of decline in final salary schemes is well-established and is unlikely to be reversed. Employers have faced the risk that asset returns and longevity increases can dramatically increase the cost of pension provision and many are now considering strategies to help them secure their pension liabilities with certainty.
“As these risks shift to employees under defined contribution (DC) pension schemes, we expect that individuals will also face the need for increased contributions and products which protect retirement outcomes.
“It is not surprising that many employees would want a material rise to switch jobs. The extra income will be needed for private savings to maintain their retirement hopes.”
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