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04/27/08
Future of employee benefits
Filed under: Networking, Job Offer (Situations), First Year on Job, Mature professionals, Post-docs, Technicians
Posted by: site admin @ 8:06 pm

WSJ April 22 published a pull-out
section on the state of
Employee Benefits.


D. Salisbury
wrote “we no longer
view ourselves as an American company,
one large corporate CEO said.  We
act as a global corporation in all of our
decision-making.”

This is a vanguard of changes that are
happening in company health insurance
and retirement plans.

Events outside US labor market and
economy are the
primary drivers of
benefits and compensation trends
within our borders—


1.  American manufacturing base
is [eroded in some
cases and] gone

[in others]

2.  Over dependence on other
nations for energy and
resource stocks


3.  Ever growing dependence
on other nations to
finance
US
debt



4.  Not enough qualified Americans
for high-skilled
knowledge based

economy.

This is an important topic that all chemical
professionals need to be tuned in to and
have some place to look for forecasts.

Two comments follow on information and
forecasts for:

    Health benefits

    Retirement plans.

(As the articles pointed out, there are
other benefits but that do not command
near the amount of attention.)
 

2 Responses to “Future of employee benefits”

  1. site admin Says:


    HEALTH BENEFITS

    Employment based coverage of 73-78% of the
    workforce continues. Type of insurance has
    changed from “paying everything” to designs
    with employee premiums, deductibles, co-pays,
    and limitations of coverage.

    Support of wellness, preventive care, chronic
    diseases and prescription drugs will continue
    to “evolve (we all know what that means.)

    Retiree coverage has decreased ever since the
    1980s. The critical rule influencing the changes
    in health care insurance coverage is an accounting
    rule (FAS 106) adopted by the Financial
    Accounting Standards Board which required
    retiree health costs to be shown on corporate
    balance sheets. Fronstin and Blakely (P. A15)
    wrote that the tipping point may be near when
    the employer based insurance is too expensive
    for the coverage.

    Despite the talk of government sponsored plans,
    many expressed skepticism.

    This is a topic high concern for all to determine
    what is most insurance coverage important to
    them and define clearly the options available
    to them.

    Four reasons employers indicated that they
    would drop health insurance coverage:

      Elimination of employer tax deduction

      Universal health care system

      Erosion or elimination of the federal
    pre-emption of state insurance regulation
    ERISA 1974

      If other employers dropped coverage.
  2. site admin Says:


    PENSION AND RETIREMENT BENEFITS

    R. Myers (p. A14) wrote about 401K plans.  
    401K plans are being retooled to be the pension
    plans replacing the former defined benefit plans.

    Accumulation is encouraged in diversified
    investment portfolios where participants can
    choose managed target date funds, matching
    their expected retirement date.

    Problem is what to do once one retires.

    How do you draw down without running
    out. “Target date funds can take care of a
    participant from age 20 to 50. The issue is
    how to meet the needs of workers age 50-plus,
    who are looking for continued growth and
    downside protection, plus guaranteed
    lifetime income.

    A tipping point may be near where annuity
    based income products will be common
    in retirement plans.

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