NU Online News Service, Jan. 25, 3:18 p.m.EST

A stunning 4 percent of employers are very confident that theiremployees will have sufficient retirement funds when they retire,according to an Aon Hewitt survey.

In a survey of more than 500 employers conducted in October2011, Aon Hewitt says it found “employer confidence in theirability to influence employee decisions and/or actions haseroded.”

In a statement Pamela Hess, director of Retirement Research atAon Hewitt, says. “The stark drop in the confidence of employers istroubling. We've known for a while that workers weren't savingenough for retirement, but it seems that with continued tougheconomic times, employers are realizing just how dire the situationhas become for much of their workforce. Fortunately, they're notsitting idly by—they're actively taking steps to help theiremployees get on a better path.”

The report, “2012 Hot Topics in Retirement: Waning Confidenceand the Need for Continued Innovation,” found that, amongemployers, 10 percent of plan sponsors feel very confident thatemployees would take accountability for their own retirementsuccess. Eighteen percent of employers say they feel very confidentthat workers will be able to manage their income duringretirement.

The survey finds that many employers are trying to helpemployees with their retirement.

• Sixty percent of employers say they are placing more emphasison helping employees understand the employer-sponsored resourcesavailable to them.
• Fifty-two percent focus on encouraging workers to take greateraccountability for their own retirement success.
• Forty-four percent of plan sponsors rate helping employeesretire with sufficient assets as a top priority.

More and more employers are abandoning pensions in favor ofdefined contribution plans, Aon Hewitt says. Among some of theissues employers are finding: employees are not saving enough toreach the employer match where workers are subject to automaticenrollment in a defined contribution plan.

“Automatic enrollment alone isn't enough to get workers wherethey need to be,” says Hess. “Plan sponsors need to step it up byencouraging employees to save at a higher rate. Adding featuressuch as contribution escalation to get workers saving at least atthe employer match level—or ideally even more—is key to helpingthem meet their savings goals.”

Employers are also adding features that are aimed at helpingemployees understand how much they need to put away for retirementand even what their spending levels can be in retirement.

Ultimately, employees are finding that their retirementfinancing options are becoming more limited.

“Once, workers could count on a steady income stream throughouttheir retirement years,” says Hess. “Now, more people are relyingexclusively on their [defined contribution] plan for theirretirement savings and that regular paycheck has disappeared,leaving many employees struggling to effectively balance retirementexpenses. Employers recognize this challenge and are addingfeatures and resources to help workers manage their savings.”