Do Employers/Employees Still Need Employee Benefits?

EBRI Policy Forum Proceedings, 1998
ISBN 0-86643-090-3
Paperback, 74 pp.
PDF, 318 kb
Employee Benefit Research Institute, © 1998

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Executive Summary

This book explores the changing structure of employee benefit programs and the nature of decision making as it pertains to these programs.

Clearly, the dynamics of the work place are changing. In the past, employee benefits were considered tools for long-term retention and retirement management. Today, employers, faced with the challenge of attracting and keeping quality employees, are using benefits such as defined contribution plans and new individual account defined benefit plans primarily as recruitment and near-term retention tools. These plans emphasize wealth accumulation, not retirement income. In addition, concern about high costs has led many employers to share at least some of the financial cost and risk associated with retirement and medical benefits directly with employees. Other employers—especially small and relatively new firms, which account for most recent job growth—are responding to this concern by offering fewer benefits. International competitiveness accounts for yet another force for change. The "new economy" has focused firms on survival. No longer are benefit plans designed against a backdrop of assumed profitability and enterprise continuation. Job entitlement has been replaced by performance measurement.

The papers in this book provide valuable insights into the thought processes behind employee benefit programs' changing objectives, and discuss why change will continue and where it is likely to take us. The authors view the future prospects of employee benefit programs from a number of different perspectives, including labor, government, academia, and business. Whether optimistic or pessimistic, most agree that it is important for the government and employers to recognize the substantial advantages these programs continue to offer American workers and their families.