A study by insurance group Old Mutual shows that most people will need between 70% and 80% of their current salary as income when they retire.
The Old Mutual Employee Benefits Monitor 2015, released yesterday, noted, however, that only 54% of staff at small and medium enterprises believed they would be in a position to self-fund retirement.
Those who might have to rely on others typically said they would need the government, their children or other family to survive post-retirement - or continue working, the study found.
It said 64% of company decision-makers and 69% of staff believed the employee benefits offered by a business played an important part in attracting employees.
The report revealed that 66% of decision-makers did not believe retirement funding was on the agenda of SMEs. But 53% of staff members believed that it was.
Most of the employers said cash flow was their first reason when deciding on paying out benefits to employees.
The second reason was the mindset of employers, the third was based on a need to attract and retain skilled staff, the fourth was due to external pressure like government legislation and unions.
The study also said it was typical for companies with 20 or more employees to consider offering a group retirement fund.
SME decision-makers revealed that the main reasons why SMEs failed to offer employee benefits were affordability, the business being too small, perception that employees should make their own provision and preference to provide higher salaries.
Other reasons included that employee benefits were perceived to be too administratively intensive and staff did not want to contribute.
Younger and unskilled workers believed that they did not have to contribute towards employee benefits.
"Typically, the results pointed to younger and less skilled employees leaning more towards a belief that the provision of employee benefits is primarily the responsibility of the company," it said.
It also showed that 92% of workers preferred to have a retirement benefit and 82% wanted a medical aid.
General manager of SME at Old Mutual Corporate Doug Clothier said the bigger a company gets, the more it had systems in place for employee benefits.
Clothier said 80% of companies felt it was important to have retirement funds but only 60% of them had the funds in place.
"There is a mismatch in terms of the statistics and the words of companies are not translating into action," he told Sowetan.
sibanyonim@sowetan.co.za
Study predicts a tough time ahead for retirees
A study by insurance group Old Mutual shows that most people will need between 70% and 80% of their current salary as income when they retire.
The Old Mutual Employee Benefits Monitor 2015, released yesterday, noted, however, that only 54% of staff at small and medium enterprises believed they would be in a position to self-fund retirement.
Those who might have to rely on others typically said they would need the government, their children or other family to survive post-retirement - or continue working, the study found.
It said 64% of company decision-makers and 69% of staff believed the employee benefits offered by a business played an important part in attracting employees.
The report revealed that 66% of decision-makers did not believe retirement funding was on the agenda of SMEs. But 53% of staff members believed that it was.
Most of the employers said cash flow was their first reason when deciding on paying out benefits to employees.
The second reason was the mindset of employers, the third was based on a need to attract and retain skilled staff, the fourth was due to external pressure like government legislation and unions.
The study also said it was typical for companies with 20 or more employees to consider offering a group retirement fund.
SME decision-makers revealed that the main reasons why SMEs failed to offer employee benefits were affordability, the business being too small, perception that employees should make their own provision and preference to provide higher salaries.
Other reasons included that employee benefits were perceived to be too administratively intensive and staff did not want to contribute.
Younger and unskilled workers believed that they did not have to contribute towards employee benefits.
"Typically, the results pointed to younger and less skilled employees leaning more towards a belief that the provision of employee benefits is primarily the responsibility of the company," it said.
It also showed that 92% of workers preferred to have a retirement benefit and 82% wanted a medical aid.
General manager of SME at Old Mutual Corporate Doug Clothier said the bigger a company gets, the more it had systems in place for employee benefits.
Clothier said 80% of companies felt it was important to have retirement funds but only 60% of them had the funds in place.
"There is a mismatch in terms of the statistics and the words of companies are not translating into action," he told Sowetan.
sibanyonim@sowetan.co.za
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