The Principal Financial Well-Being IndexSM Employee Questions - Fourth Quarter 2006
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Benefit Programs Offered at Businesses with 10 to 1,000 Employees
The top benefits offered at firms with 10 to 1,000 employees are Health Insurance (93%), Defined Contribution Plans (73%), Life Insurance (71%), Free Parking (62%) and Disability Insurance (49%). In table 14 below, comparisons can be made with the previous year's benefit offerings. There are some significant differences between responses from this most recent quarter and 4th quarter 2005 - indicated with "SIG" below.
Table 14 - Benefits Offered
"What types of benefit programs (excluding vacation and holidays) does your company currently offer you? Please select all that apply."
Base: 1197 employed U.S. adults in firms of 10-1,000 employees
| Benefits | Overall 2006 | Overall 2005 | Overall 2004 |
| Health Insurance | 93%SIG | 88% | 89% |
| Defined Contribution | 73%SIG | 64% | 72% |
| Life Insurance | 71%SIG | 65% | 63% |
| Free Parking | 62%SIG | 57% | 59% |
| Disability Insurance | 49% | 48% | 53% |
| Tuition Reimbursement | 32% | 30% | 34% |
| Flex-time | 28% | 26% | 28% |
| Profit-Sharing/Bonus | 23% | 26% | 28% |
| Pension - Defined Benefit | 19% | 22% | 20% |
| Stock Options | 7%SIG | 11% | 10% |
| Financial Planning | 7%SIG | 10% | 10% |
| Personal Banking Services | 7% | 8% | 7% |
| Legal Services | 7% | 7% | 8% |
| Other | 5% | 5% | 4% |
| Child Care Subsidies | 4% | 4% | 3% |
| On-site Daycare | 2% | 3% | 2% |
| Executive Benefits | 1%SIG | 4% | 5% |
| N=1197 | N= 1,213 | N=1,736 |
SIG = Significant at the 95% confidence level
Benefit Satisfaction
Upon identifying what benefits they are offered through their employers, employees were asked to rate their satisfaction with some of the major benefits. Employees are most satisfied (rating of 8-10 on a 10 point scale) with their Defined Benefit Plan (64%), Defined Contribution Plan, (54%), Life Insurance (52%), Disability Insurance (51%) and Profit Sharing/Bonus (50%). In comparing this quarter's results with the previous year, there are significant increases in satisfaction levels for Life Insurance and Profit sharing/Bonus plans.
Table 15
"Please indicate how satisfied you are with each benefit program."
(rating of 8, 9 or 10 on a 10 point scale)
Base: Respondents with each particular benefit
| Benefits | Satisfaction Top 3 Box 2006 |
Satisfaction Top 3 Box 2005 |
Satisfaction Top 3 Box 2004 |
| Pension - Defined Benefit | 64% | 62% | 64% |
| Defined Contribution | 54% | 54% | 55% |
| Life Insurance | 52%SIG | 45% | 51% |
| Disability Insurance | 51% | 48% | 50% |
| Profit-Sharing/Bonus | 50%SIG | 41% | 52% |
| Health Insurance | 47% | 44% | 45% |
| Stock Options | 44% | 46% | 53% |
SIG = Significant at the 95% confidence level
Benefit Importance
All employee respondents were asked to rate a group of benefits in terms of how important it was to them on a 10-point scale with 10 being "Very Important." As seen in Table 16, Defined Contribution has increased significantly in importance and Disability Insurance has declined significantly in importance since 2005.
Table 16
"Please indicate how important each benefit program listed below is to you."
(rating of 8, 9 or 10 on a 10 point scale)
Base: 1197 employed U.S. adults in firms of 10-1,000 employees
| Benefits | Importance Top 3 Box 2006 |
Importance Top 3 Box 2005 |
Importance Top 3 Box 2004 |
| Health Insurance | 91% | 90% | 90% |
| Defined Contribution | 75%SIG | 71% | 75% |
| Pension - Defined Benefit | 53% | 55% | 51% |
| Disability Insurance | 51%SIG | 55% | 50% |
| Life Insurance | 50% | 51% | 46% |
| Profit-Sharing/Bonus | 43% | 44% | 44% |
| Stock Options | 17% | 18% | 20% |
| N=1197 | N=1,213 | N=1,736 |
SIG = Significant at the 95% confidence level
Each employee respondent was asked to identify what benefits they would most like their employers to offer, aside from those already offered. Defined Benefit Plans top the list with 25%, followed by Profit Sharing/Bonus and Flex-time, each with 14%. Defined Benefit plans and Flex-time both saw significant increases since 2005.
Table 17
"Which one employee benefit do you most wish that your company would offer you (excluding vacation and holidays)?"
Base: 1197 employed U.S. adults in firms of 10-1,000 employees
| Benefits | 4 Qtr 2006 | 4 Qtr 2005 |
| Pension - Defined Benefit Plan | 25%SIG | 18% |
| Profit-sharing/bonus | 14% | 12% |
| Flex-time | 14%SIG | 11% |
| Tuition Reimbursement | 8% | 6% |
| Defined Contribution Plan | 6%SIG | 9% |
| N=1197 | N=1212 |
SIG = Significant at the 95% confidence level
Aside from those benefits employees would like to see added to their employer's benefit programs, they were also asked to identify what benefits they would like to have improved upon. The top two benefits mentioned are Health Insurance (43%) and Defined Contribution Plan (17%).
Table 18
"Which one employee benefit (excluding vacation and holidays) do you most wish that your company would improve upon?"
Base: 1197 employed U.S. adults in firms of 10-1,000 employees
| Benefits | 4 Qtr 2006 | 4 Qtr 2005 |
| Health Insurance | 43% | 45% |
| Defined Contribution Plan | 17%SIG | 14% |
| Profit Sharing/Bonus | 6% | 8% |
| N=1197 | N=1209 |
SIG = Significant at the 95% confidence level
Benefits for Recruit & Retention
Firms with 10 to 1,000 employees offer employee benefits to aid in the recruiting and retaining of quality employees. To measure how employees react to the presence of good employee benefits, a series of agree statements were asked. The results have remained relatively unchanged since 2005. - see table 19.
Table 19
"Please indicate the extent to which you agree or disagree with each of the following statements."
Base: 1197 employed U.S. adults in firms of 10-1,000 employees
| Trending Comparison (% of respondents agreeing completely or somewhat) |
4th Qtr 2006 EE |
4th Qtr 2005 EE |
4th Qtr 2004 EE |
| Having a good employee benefits plan encourages me to work harder and perform better. | 67% | 65% | 70% |
| Having a good employee benefits plan keeps me working for my current company. | 62% | 62% | 65% |
| My company is concerned about my long-term financial future. | 25% | 25% | 33% |
| N=1197 | N=1,213 | N=1,736 |
Job Security
Job security continues to top the importance chart when compared to long-term financial future and challenging work. However, it has declined significantly since last year. The importance of long-term financial future has seen a significant increase from last year, but still not large enough to overtake job security as the item ranked first in importance most often.
Table 20
"Please rank the following items in terms of how important it is to you."
Base: 1197 employed U.S. adults in firms of 10-1,000 employees
| Respondent Ranked Item #1 | 4 Qtr 2006 | 4 Qtr 2005 | 4 Qtr 2004 |
| Job Security | 45%SIG | 52% | 47% |
| Long-Term Financial Future | 41%SIG | 36% | 35% |
| Challenging Work | 14% | 12% | 19% |
| N=1197 | N=1,213 | N=1,736 |
SIG = Significant at the 95% confidence level
Workplace Issues
Employees were asked a series of questions about their perceptions of their work and the workplace. Employees were asked why they go to work and the response chosen most often was "to pay the bills" (89%), followed by "because I need the benefits" (64%), and "to save for the future" (51%).
Table 21
"Which of the following describes why you go to work? Please select all that apply."
Base: 1197 employed U.S. adults in firms of 10-1,000 employees
| Reason to Work | 4 Qtr 2006 EE |
2 Qtr 2003 EE |
| To pay the bills | 89%SIG | 86% |
| Because I need the benefits (such as health insurance and retirement ) for me and/or my family | 64%SIG | 58% |
| To save for the future | 51%SIG | 45% |
| For enjoyment, challenge, or fulfillment | 47% | 45% |
| For additional material purchases and to improve my lifestyle | 42% | 44% |
| For the camaraderie or social contact | 29% | 28% |
| To get out of the house | 20%SIG | 15% |
| None of these | 1% | <1% |
| N=1197 | N=1216 |
SIG = Significant at the 95% confidence level
There are several things employees feel their employers could be doing to help them get more out of work. This same question was asked in 2003 and the results have remained fairly consistent. Providing better pay for performance is the item selected by the majority of the employees (73%). Almost half (47%) would like to have better workplace benefits.
Table 22
"Which of the following, if any, could your employer do to help you get more out of work? Please select all that apply."
Base: 1197 employed U.S. adults in firms of 10-1,000 employees
| My Employer Could... | 4 Qtr 2006 EE |
2 Qtr 2003 EE |
| Provide better pay for my performance | 73% | 71% |
| Provide better workplace benefits | 47% | 45% |
| Provide more professional development opportunities | 36% | 34% |
| Give me opportunity to learn new skills | 35%SIG | 39% |
| Ensure better communication with management | 32% | 35% |
| Provide more assistance with work/life balance | 24% | 22% |
| Provide more networking opportunities | 12% | 11% |
| Other | 7%SIG | 3% |
| N=1197 | N=1216 |
SIG = Significant at the 95% confidence level
When asked if the length of their average workweek has changed compared to a year ago, about three out of ten (29%) employees say they are working more this year. Fifty-nine percent say it is about the same.
Table 23
"Compared to this time last year, how has the length of your average workweek changed?"
Base: 1197 employed U.S. adults in firms of 10-1,000 employees
| Change in Length of Workweek | 4 Qtr 2006 EE |
3 Qtr 2004 EE |
| I am working less this year. | 11%SIG | 6% |
| I am working about the same this year. | 59%SIG | 64% |
| I am working more this year. | 29% | 30% |
| N=1197 | N=1227 |
SIG = Significant at the 95% confidence level
Three out of five (60%) employees rate their overall level of job satisfaction with their current employer as satisfied or very satisfied. One out of five (20%) employees are neither satisfied nor dissatisfied and the remaining 20% are dissatisfied or very dissatisfied.
Table 24
"What is your overall level of job satisfaction with your current employer?"
Base: 1197 employed U.S. adults in firms of 10-1,000 employees
| Level of Job Satisfaction | 4 Qtr 2006 EE |
| Very Satisfied | 15% |
| Satisfied | 45% |
| Neither satisfied nor dissatisfied | 20% |
| Dissatisfied | 15% |
| Very Dissatisfied | 5% |
Managing Investments
Employees in firms of 10 - 1,000 employees were asked to identify how they prefer to make investment decisions. Over half (54%) prefer to select investment funds/ accounts on their own.
Additionally, those respondents who noted they prefer to have someone manage their investments were also asked if they preferred target date funds handled by a fund manager, target risk funds handled by a fund manager or fee-based financial advisors acting on their behalf. Forty-four percent preferred target risk funds handled by a fund manager. See Table 26 for details.
Table 25
"Which of the following statements best describes how you prefer to make investment choices?"
Base: 1197 employed U.S. adults in firms of 10-1,000 employees
| Preferred Choice Method | 4 Qtr 2006 EE |
| I prefer to select investment funds/accounts on my own. | 54% |
| I prefer to have someone manage my investments for me. | 35% |
| Other | 11% |
Table 26
"Which of the following approaches would you select if you had someone manage your investments for you?"
Base: N=445 employed U.S. adults (based on those who prefer to have someone manage his/her assets)
| Managed Investment Choices | 4th Qtr. 2006 EE |
| Select lifecycle/target risk funds that are handled by a fund manager based upon my preferred level of risk (e.g., aggressive, moderate or conservative). | 44% |
| Select lifecycle/target date funds that are handled by a fund manager based upon my estimated retirement year | 23% |
| Select professionally managed accounts - fee-based financial advisor making investment choices on my behalf | 24% |
| None of these | 9% |
