WTW’s 2022 survey of Defined Contribution (DC) plan sponsors shows that many Canadian employers are eyeing enhancements to their DC retirement plans to boost their employees’ retirement security and financial wellbeing. They are also planning to sharpen their focus around member experience, and to better leverage their plans for employee attraction and retention.
Evolution of DC plans continues as two out of three sponsors (67%) expect to change their DC plan in next two years after already having made a change in last two years. An additional 19% of sponsors that didn’t make a change over the last two years plan on making at least one change over the next two years. Most of the expected enhancements will focus on the employee experience (76%) and financial wellbeing (69%). Additionally, just over half (53%) expect to make changes to their plan design.
86% of defined contribution (DC) plan sponsors expect to make at least one change to their plan over the next 2 years.
3 in 4 expect changes to enhance their employees' experience
Most expected changes in DC plan design over next two years involve adding or enhancing features, with about one-third focusing on employer contribution features and 28% interested in other design features.
53% of sponsors intend to change DC plan design over the next 2 years
33% of sponsors are considering changes to their employer contribution features
| Plan sponsors have taken, or are planning or considering, the following actions to support employee’s retirement security: | Action taken | Planning or considering |
|---|---|---|
| Integrating the defined contribution plan strategy with financial wellbeing and resilience | 34% | 35% |
| Using targeted communication tailored to specific segments | 35% | 32% |
| Using listening strategies to identify employee needs and support program changes | 31% | 36% |
| Analyzing workforce outcomes to assess needs for at-risk employees | 7% | 27% |
More than half of plan sponsors expect attraction and retention issues over next two years, with just over one-quarter of those sponsors viewing their DC plan as an important tool to distinguish them from their competitors.
56% of sponsors expect to face attraction and retention issues over the next 2 years
Overall, almost half of respondents regard attraction and retention considerations an important part of their DC plan strategy.
To what extent will the following be a priority to your defined contribution plan strategy over the next two years?
By integrating retirement plans into broader employee experience, plan sponsors have opportunities to meet employees across their life cycle, and better support them in managing their increasingly complex needs. Actions that employers can take include:
In today’s challenging labour environment, retirement benefits remain a high priority for Canadian workers and their employers. By increasing alignment between sponsors’ plans and employee needs, DC plan sponsors can strengthen both their plan’s value and participant outcomes.
| Title | File Type | File Size |
|---|---|---|
| Canadian Defined Contribution Pulse Survey - 2022 | 3.2 MB |
