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Employers are cutting many benefits and perks, from the traditional pension plan to the company picnic
Traditional pension plans, paid family leave, and even the company picnic are all on the decline. Employers have significantly cut many of the benefits they offer to workers over the past five years. Some 77 percent of companies report that benefits offerings have been negatively affected by the slow pace of recovery, according to a Society for Human Resource Management survey of 600 human resources professionals. "The two biggest areas where cuts have come have been in health care and retirement because that's where costs have increased the most," says Mark Schmit, research director of the Society for Human Resource Management in Alexandria, Va. Here is a look at the workplace perks that have significantly declined since 2007.
Traditional pension plans. Traditional pensions were offered at 40 percent of the companies surveyed in 2007. Now just 22 percent of firms provide access to a retirement plan that guarantees payments for life. More commonly offered retirement benefits include 401(k)s and similar types of retirement accounts (93 percent) and Roth 401(k) accounts (31 percent). However, the proportion of companies offering a 401(k) match declined from 75 percent in 2008 to 70 percent in 2011.
Retiree health care coverage. The proportion of companies offering retiree health insurance declined from 35 percent in 2007 to 25 percent in 2011, SHRM found. "Retiree medical plans are costly and the costs have changed over time due to factors outside the employer's control," says Stephen Parahus, a Towers Watson consultant. "More often than not new employees are not on a path that is going to earn them a subsidized employer benefit when they retire."
Long-term care insurance. Just over a quarter (29 percent) of employers provide long-term care insurance for workers, down from 46 percent in...