Financial well-being is a new top priority for Singapore employers: Aon survey

40 percent of employers in Singapore rank financial well-being as the most important part of their employee well-being strategy, according to new research by Aon. And they are acting on it: the 2021 Trends in Retirement & Financial Wellbeing survey found that companies are now incorporating financial well-being programs into their employee engagement and talent attraction strategies, and that some 70 percent of Singapore employers are likely to offer their employees some form of financial education over the next two years.

Part of the underlying issue is that many employees in Singapore may not have adequate savings for their retirement. While Singapore citizens and permanent residents receive Central Provident Fund benefits and some companies also offer top-up contributions to CPF on top of the statutory contributions, Aon's figures show that close to 40 percent of the working population in Singapore are foreigners who do not have access to CPF and are likely to have foregone their retirement benefits in their home countries. And only half the companies surveyed offer supplementary retirement benefits to these employees—most commonly in the financial services, technology, and healthcare sectors.

Employers do recognize the role that retirement benefits play in talent attraction and retention, with over 35 percent of employers saying that their current retirement support programs are not effective in either talent attraction or retention, or even in building adequate retirement savings.

Alicia Brittain, Senior Consultant & Actuary, Retirement & Investments, Singapore for Aon,said of the findings: “Forward-looking companies first need to understand the financial worries of their employees and identify the gaps in their benefits offering. The most effective approaches are aimed at changing individual behaviors towards money and savings and providing accessible programmes and vehicles to deliver sustainable change.”

The financial well-being of Singapore employees has been a cause for concern since COVID-19 began, with figures from DBS Bank showing that a disturbingly large proportion of workers have inadequate emergency savings due to the pandemic's impact. However, the government did not reduce employee statutory contributions to CPF during the period despite some arguments that doing so would leave workers with more disposable income.