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Retirement a cultural thing

By Barbara Whelehan · Bankrate.com
Friday, April 20, 2012
Posted: 4 pm ET

How important is a workplace retirement plan to people around the world? The answer seems to depend on cultural preference. In both Canada and the U.S., that benefit ranks second in importance, topped only by base pay.

But elsewhere in the world, workplace retirement plans don't rank high among "elements of the value proposition" -- business jargon meaning what workers can expect from their employers. In other words, it's not one of the main reasons people choose a particular job. For instance, in India a retirement benefit places seventh out of 13 value-proposition elements. In Brazil, Germany and Spain, it ranks eighth, and in Australia and Ireland, it lands in ninth place on people's lists of workplace expectations. This is according to "What's Working Around the World," a new survey of 30,000 employees in 17 countries by global H.R. consulting firm Mercer.

People disgruntled about work

One common attribute: A lot of people are not engaged at work. The survey's biggest finding is that on average, 4 out of 10 workers around the world right now are seriously considering quitting their jobs. The urge to abandon ship is more pronounced in Latin America and the Asia-Pacific region than it is in Europe and the U.S., where about 1 in 3 want to flee.

Perhaps more troubling is that roughly "20 percent to 25 percent of the employees in each country have no definite plans to leave but are apathetic and even more negative about work than employees who are considering an exit," according to the report.

What's their beef, and is it universal? "Without question, employees liked the 'old deal' of more generous benefits and pensions, steady pay increases and lifetime job security. They have -- reluctantly -- accepted that it is not coming back," states the report. Nevertheless, workers believe their employers are not delivering on the "new deal" of paying for performance rather than tenure.

A surprising finding

The table below shows how workers around the world feel about their retirement readiness. Results from France are not included because the French were not asked exactly the same questions. Maybe they were asked when they planned to go on strike next or if their six-week vacations afforded sufficient time to unwind.

But seriously, it's interesting to see how people around the world gauge themselves with respect to retirement planning. Roughly 4 in 10 respondents from some of the mature economies, including the U.S., Australia and Canada, say they're doing enough to prepare for retirement. That's not reassuring since that's not a majority. Meanwhile, roughly 6 in 10 respondents from developing countries, such as China, India, Brazil and Mexico, feel confident they're doing enough to secure their future retirements.

What accounts for the disparity in retirement confidence between workers from the so-called prosperous nations versus those from up-and-coming nations? Are they better savers than us? Do they have lower, or more realistic, expectations about retirement? Are we more cynical? Or is it because the economies of mature countries have sputtered while emerging markets are running on all cylinders?

I don't have an answer, but I welcome your thoughts.

Retirement readiness around the world
  I am doing enough to prepare financially for retirement My organization is doing enough to help me prepare for retirement
North America
Canada 43% 40%
U.S. 43% 41%
Latin America
Argentina 46% 36%
Brazil 61% 57%
Mexico 65% 61%
Europe
Germany 54% 41%
Ireland 41% 40%
Italy 44% 38%
The Netherlands 51% 45%
Spain 41% 32%
United Kingdom 38% 35%
Asia Pacific
Australia 42% 38%
China 57% 41%
Hong Kong 41% 33%
India 61% 57%
Singapore 45% 35%
Source: Mercer.

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