DC plan executives see retaining coping strategies post-pandemic – P&I survey

Having made changes in plan management and participant communications because of the COVID-19 outbreak, many defined contribution executives say they plan to retain some of those strategies in a post-pandemic environment, Pensions & Investments reported in a survey released Thursday.

Ninety-four percent of respondents said they are likely to continue greater use of virtual technology for external meetings and 80% said they are likely to increase their use of virtual technology for internal meetings.

The results were unveiled during the 2021 DC Spring Virtual Series, held from March 8 through March 11, a pandemic-inspired pivot from P&I's Defined Contribution East Coast Conference, traditionally held each spring in Florida.

The pandemic has caused "a profound change" in how employers view traditional work settings, said Chris Battaglia, vice president and group publisher of Pensions & Investments, during a video conference describing the survey's results. Greater use of virtual technology and more remote work "are here to stay."

The post-pandemic DC world also will feature more flexibility in how, when and where people work.

The survey said 75% of respondents "expect the adoption of a work-from-anywhere approach," allowing for "alternative work arrangements." Seventy-six percent expect to have more flexible schedules and work hours, said the survey of 102 asset owners, primarily top executives and senior human resources officials, as well as benefits and retirement officials.

For now, 71% said they work exclusively from home, 20% split work time between home and office, and 9% work at their offices.

However, the survey results show "it's clear that companies and employees are uncertain about returning" to the pre-pandemic work environment, said Mr. Battaglia, who also is chief executive officer of the WorldPensionSummit.

Future formal return-to-work plans are varied, the survey said. Twenty-eight percent of respondents said they don't expect to return to a traditional work environment on a full-time basis. Sixteen percent said they expect to return to the office full-time during the second quarter of 2021, and another 36% said they would do so by the third quarter.

Among the others, responses were evenly divided among those who plan to return to the office full time during the fourth quarter of 2021 and those who expect to return in the first quarter of 2022.

The survey noted that DC plan executives' return-to-work plans don't always match what all workers in their companies or organizations will do. Forty-five percent of respondents said their scheduled return to the office was the same as that of all workers, but 23% said it wasn't. Thirty-two percent said they did not know other workers' schedule for full-time office-based work.

Despite the health and economic ravages of the pandemic, 46% of sponsors said they saw no change in the percentage of plan participation while 40% saw a "slight to moderate increase" in participation. Another 14% of respondents detected a "slight to moderate decrease" in plan participation.

"Consistent efforts of communication" and auto-enrollment helped most participants stay focused on long-term retirement goals, Mr. Battaglia said.

Beyond making pandemic-provoked changes, the survey cited a list of future top business priorities for the surveyed DC executives:

• Seventy-seven percent said they would focus on employee well-being and engagement as key components of business performance.
• Seventy-four percent said they would update business continuation plans to include effective work arrangements that will be long-term or permanent.
• Fifty-five percent said they need to understand the new economic realities of COVID-19 and try to anticipate how unpredictable revenues and expenses will be.

Among the sponsors' top retirement priorities, extending financial wellness education was the clear leader (72%), followed by helping participants build savings (32%) and increasing plan participation (32%).

Referencing another type of virus — cyberattacks — Mr. Battaglia said the survey illustrated why the pandemic "has accelerated the need" for more defenses against hackers as more employees work remotely.

In the survey, 85% of respondents cited phishing attempts targeting the overall workforce as the biggest problem, while 58% worried about computer hackers going after participants' accounts, sensitive data and resources.

When asked if their employers had experienced a cyberattack in the last 12 months, 50% of respondents cited phishing, 18% were hit by malware, 4% were affected by ransomware and 4% experienced denial of service, the survey said.

To guard against hackers, 78% of respondents said they are expanding employee cybersecurity training throughout their companies and organizations; 44% are reinforcing the importance of managers engaging with staff to discuss and identify cybersecurity risks; and 37% are increasing their technology budgets to improve their defenses against hackers.

"Training is certainly on the increase," Mr. Battaglia said.

Among the survey respondents, 59% represented corporate plans; 22% were from government plans; 13% were from non-profit organizations; and 6% represented educational institutions, unions, foundations and pension associations. The online survey was conducted during two weeks in February.

Nine percent of respondents represented plans with assets of $25 billion or more; 13% were executives in plans with assets of $10 billion to $24.9 billion; and 29% represented plans with assets of $3 billion to $9.9 billion; and 20% were from plans with assets of $1 billion to $2.9 billion. The other 29% were members of plans with less than $1 billion in assets.

Also, 44% of respondents represented employers with 15,000 or more employees; 18% work for employers with 5,000 to 14,999 employees; 16% were executives of employers with 1,000 to 4,999 employees; and 22% were from employers with fewer than 1,000 employees.