Despite Full Employment, Less than 10 Percent to Spend More This Holiday Season
Dec. 05, 2006 (Des Moines, Iowa) — As Americans descend on the malls and shopping websites, only a small minority are planning to spend more money this holiday season than last year, according to the latest Principal Financial Well-Being IndexSM. Just nine percent of workers and five percent of retirees indicated they planned to spend more money than last year according to the latest survey. The index, which surveys U.S. working adults at growing businesses with 10 to 1,000 employees, is released each quarter by the Principal Financial Group® and conducted by Harris Interactive®. It also surveys retired Americans in acknowledgement of the retiring Baby Boom generation.
As American workers look ahead to 2007, one of their New Year's financial resolutions will be to take a disciplined approach with their spending. More than one-third (37 percent) said they plan to pay off credit card debt, and 33 percent indicated they will put a set amount of money into savings each month. Among retirees, the most-cited resolution is to reduce spending by a specific amount each month (15%).
"Despite full employment nationally, American workers are most serious about reducing debt and increasing savings," said Dan Houston, executive vice president, Retirement and Investor Services, The Principal®. "The small percentage of workers and retirees planning to spend more this holiday season appear to be experiencing the benefits of the rising economy, yet the vast majority — 90 percent — remain extremely cautious."
Take This Job and Love It
The Index revealed that almost three-quarters of employees (71 percent) and half of retirees (50 percent) said they were very concerned about their long-term financial future.
"It is no wonder that many work well beyond their 50s and 60s to pay for their basic necessities and maintain their current financial well being, or just to stay engaged," said Houston. The Index found that 90 percent of employees and 87 percent of retirees believe there should not be a mandatory retirement age.
The Index revealed that not all retirees are taking advantage of their extra leisure time. A quarter of retirees (26 percent) indicated that they were almost always, often or sometimes bored in retirement.
"When it comes to the ideal retirement age, workers and retirees are in agreement on one thing: it's a personal decision and not something that government should mandate," commented Houston. "For many, it's an economic decision to keep working, in order to pay mounting healthcare bills, keep up with inflation or just to cover the basic necessities. For others, it is simply a desire to stay active, engaged and make a contribution."
Workplace Issues in Perspective
When asked what employers could do to help them get more out of work, workers still value a pay increase over anything else. Nearly three-quarters of workers (73 percent) indicated that their employers could provide better pay for performance. This was followed by almost half (47 percent) who indicated providing better workplace benefits.
Employers who consider these worker requests might see improved worker satisfaction. This Index revealed about three in five (61 percent) workers indicated they were either satisfied or very satisfied with their employers, while 20 percent indicated they were dissatisfied or very dissatisfied.
This desire for better pay and benefits is borne out by workers who are spending more time working. When workers were asked how the length of their work week compares with a year ago, nearly three out of ten employees (29 percent) admitted to working more this year.
Workers were also asked a series of questions regarding their perceptions of their work and the workplace. Workers were given the option to select more than one choice regarding why they go to work. The responses chosen most frequently included were to pay the bills (89 percent), followed by needing the benefits (such as health insurance and retirement) (64 percent) and to save for the future (51 percent).
Methodology
This survey was conducted online within the United States by Harris Interactive on behalf of The Principal Financial Group between October 23 to November 1, 2006 among employees 1,197 employees and 630 retirees (ages 18+) of small and midsized (SMB) U.S. businesses (firm size 10 - 1,000 employees). Figures for age by gender, age, education, race/ethnicity, region and income were weighted where necessary to bring them into line with their actual proportions in the population. Propensity score weighting was also used to adjust for respondents’ propensity to be online.
With a pure probability sample of 1,197 employees and 630 retirees, one could say with a ninety-five percent probability that the overall results would have a sampling error of +/- 3 percentage points for employees and +/- 4 percentage points for retirees. Sampling error for data based on sub-samples would be higher and would vary. However, that does not take other sources of error into account. This online survey is not based on a probability sample and therefore no theoretical sampling error can be calculated.
About the Principal Financial Group
The Principal Financial Group® (The Principal®)1 is a leader in offering businesses, individuals and institutional clients a wide range of financial products and services, including retirement and investment services, life and health insurance and banking through its diverse family of financial services companies and national network of financial professionals. A member of the Fortune 500, the Principal Financial Group has $215 billion in assets under management2 and serves some 16.4 million customers worldwide from offices in Asia, Australia, Europe, Latin America and the United States. Principal Financial Group, Inc. is traded on the New York Stock Exchange under the ticker symbol PFG. For more information, visit www.principal.com.
About Harris Interactive
Harris Interactive is the 12th largest and fastest-growing market research firm in the world. The company provides research-driven insights and strategic advice to help its clients make more confident decisions which lead to measurable and enduring improvements in performance. Harris Interactive is widely known for The Harris Poll, one of the longest running, independent opinion polls and for pioneering online market research methods. The company has built what it believes to be the world's largest panel of survey respondents, the Harris Poll Online. Harris Interactive serves clients worldwide through its United States, Europe and Asia offices, its wholly-owned subsidiary Novatris in France and through a global network of independent market research firms. The service bureau, HISB, provides its market research industry clients with mixed-mode data collection, panel development services as well as syndicated and tracking research consultation. More information about Harris Interactive may be obtained at www.harrisinteractive.com.
To become a member of the Harris Poll Online and be invited to participate in online surveys, register at http://go.hpolsurveys.com/PR.
1) The Principal ranks No. 1 in plans administered – 2006 Spectrem Group analysis of fully bundled 401(k) providers.
2) As of Sept. 30, 2006
