Amidst high U.S. unemployment and against the backdrop of a volatile economy, workers 18-34 years old are increasingly concerned about job loss and having to delay retirement, according to the 2011 Mercer Workplace Survey, a nationally representative survey of employees enrolled in their employer’s 401(k) and health plans.
Nearly half of these young workers (48%) are concerned they may lose their job in the next 12 months (compared to 42% of the general population), and more than one-third (34%) have considered delaying retirement past their original target age. Both of these figures are the highest recorded for this age group and mark statistically significant increases since 2007. The fear of job loss has nearly doubled from one in four respondents to nearly one in two, and concern about delaying retirement has risen from one in five respondents to one in three. The increases for this younger population are also greater than for the population overall.
“Given the fact that this younger generation has felt first-hand the effects of the recession, ongoing layoffs, benefit cutbacks and high unemployment, it is not surprising that so many of these same workers are concerned about their own job security and have considered delaying retirement,” says Suzanne Nolan, partner and director of marketing and communications for Mercer’s U.S. outsourcing business. “The fact that their concern is equal to or even higher than their older colleagues speaks to how unsettling these past few years have been for younger workers.”
This bleak outlook of younger workers does have a positive upside, however, in terms of increased retirement savings. In fact, for the first time participants ages 18-34 have a higher average annual expected contribution to their 401(k) plans than the total population.
“One of the resounding themes is that across all age brackets, retirement savers are feeling a heightened sense of personal accountability and responsibility for a successful retirement, and these younger workers are no exception," says Nolan. “Employees seem to be trying to take control of all that they can now, given their uncertainty about the future. Retirement plan sponsors and administrators should take advantage of this commitment and focus by further building targeted education and engagement efforts for this important group of long-term retirement savers.”
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