Even though the economy has improved significantly since the recession, some companies continue to cut benefits for employees. Over the past five years, employers have reduced a variety of benefits, educational assistance and perks, according to a Society for Human Resource Management member survey of 510 human resources professionals. Here's a look at workplace benefits that are in decline:
Pensions. Less than a quarter (24 percent) of the employers SHRM surveyed continue to provide a traditional pension plan open to all employees. In contrast, 89 percent of the employers offer a 401(k) plan or similar type of retirement account, and most (74 percent) provide an employer contribution to the retirement account. "Fewer large employers provide a defined-benefit pension, shifting more of the responsibility for retirement to defined-contribution plans, which necessitates that employees be very active in the oversight and management of lifetime income," says Shane Bartling, a retirement leader for Towers Watson in San Francisco.
[See: 10 Trendy 401(k) Plan Perks.]
Retiree health insurance. Fewer companies are providing retiree health care coverage to former employees, declining from a quarter in 2010 to 18 percent in 2014. "In the early 90s, the awareness of the cost of retiree health benefits began to hit the radar when they were put on the balance sheets of companies in accordance with financial accounting changes," Bartling says. "Since then, that awareness has led to efforts to control the risk exposure and manage the cost of those programs."
Long-term care insurance. Long-term care insurance can help you cover costs associated with a chronic illness or disability, but fewer employers are offering this benefit. The proportion of employers providing long-term care insurance for employees has declined from 31 percent in 2010 to 24 percent in 2014. "The number of insurance companies providing long-term care has been dramatically reduced," says Jeffrey Brown, a finance professor at the University of Illinois at Urbana-Champaign. "If you are an employer looking to cut costs, and you hear that your long-term care insurance provider is getting out of the business, it is a natural focal point for asking, 'Is this the time we should just get out?' rather than going through the process of vetting another provider." Employer-provided home insurance (3 percent) and automobile insurance (6 percent), while never common offerings, continue to decline in popularity. And the number of employers willing to give loans to employees for emergency or disaster assistance has declined from 18 percent in 2010 to 12 percent in 2014.
Education benefits. Some employers offer workers help paying for college costs. Just over half (54 percent) of companies offer undergraduate educational assistance, down from 62 percent in 2010. And the proportion of employers willing to pay for cross-training to develop skills not directly related to the job has declined by 10 percentage points to 39 percent. "This is an investment by the employer, and if a lot of employees take advantage of it, then it can be a huge cost to the organization," says Evren Esen, director of SHRM's survey programs. "It may also be that employers are using the educational assistance and then leaving, so it's not really benefiting the organization." Fewer employers are chipping in for professional memberships, college selection and referral services and English as a second language classes. And company-sponsored 529 plans, which were provided by 13 percent of employers in 2010, were offered by just 6 percent in 2014.
[Read: College Discounts for Retirees.]
Perks for parents. Dependent care flexible spending accounts allow parents to use pretax dollars to pay for childcare. However, the percentage of employers offering these accounts declined 8 percentage points over the past five years to 64 percent in 2014. Child care referral services are now offered by just 10 percent of employers, down 7 percentage points from 2010. And on-site vaccinations for infants and children, which were provided by 5 percent of employers in 2010, are now offered by just 1 percent of companies.
Help with elder care. Elder care referral services are provided by 5 percent of employers, down from 11 percent in 2010. And only about 1 percent of employers continue to offer geriatric counseling or backup elder care services. "When organizations look at their employee assistance program offerings, they can determine if it is something that is being using by employees, and if it's not something that is being used, then it may be dropped," Esen says.
On-site health services. The proportion of employers offering on-site seasonal flu vaccinations (58 percent) and CPR or first aid training (45 percent) have each declined by 10 percentage points over the past five years. On-site perks including massage therapy services (6 percent) and stress-reduction programs (3 percent) both decreased by 6 and 7 percentage points, respectively.
Vacation time cashouts. Only a small number of employers (8 percent) allow workers to cash out their paid vacation days, down from 18 percent in 2010. And even fewer companies let workers donate their paid sick or vacation leave to others who need it (6 percent), SHRM found. The proportion of employers offering paid personal days has also declined from 29 percent in 2010 to 22 percent in 2014. "If you offer sick leave and you allow a certain number of days to roll over, and then if the employee doesn't use those days beyond what is allowed to roll over, there is really no cost to the employer," Esen says. "If you allow them to donate that time, it is dollars on their bottom line."
Tickets. Most employers are no longer chipping in for employee recreation costs. Fewer employers are offering discount ticket services (30 percent) or company-purchased tickets (22 percent) to theme parks, sporting events or concerts.
Company sports teams. Fewer employees are spending their evenings or weekends playing on the company softball or soccer teams. "In addition to physical exercise and health benefits, sports teams offer employees a chance to socialize and build rapport outside of their work environment," according to the SHRM report. But only 12 percent of organizations continue to sponsor sports teams for employees, down from 22 percent in 2010.
More From US News & World Report
- 10 401(k) Facts Everyone Should Know
- 10 Ways to Reduce the Cost of Retirement
- 10 Retirement Savings Tips for 20-Somethings
- Investing Education