September 21, 2018

The Roundup: U.S. workers aren’t saving money, case for a shorter workday, and IQs are decreasing

In this week’s Roundup, most U.S. workers don’t have adequate retirement savings, and a suggestion to end the work day at 3 p.m. Plus, we may be becoming less smart.

Is retirement out of reach for U.S workers?

A new report from the National Institute on Retirement Security (NIRS) finds that almost 60% of U.S. workers have no retirement account assets. The analysis of U.S. Census Bureau data found that the median retirement account balance among working individuals is zero dollars, according to the NIRS.

Other key findings:

  • 57% (that more than 100 million) working-age individuals don’t have any retirement assets in an employer-sponsored 401(k)-type plan, individual account, or pension.
  • Four out of five working Americans have less than a year’s income saved in retirement accounts.
  • More than three-quarters of Americans don’t hit retirement savings targets, even after researchers accounted for individuals’ net worth.

HR Dive reports on why these findings are important for employers:

When workers haven't prepared for retirement, empty 401(k)s can mean hard times for businesses, too, Diane Oakley, report author and NIRS executive director, told HR Dive in an interview.

Oakley added that employees who don’t have adequate retirement savings may decide to keep working – but that comes with potentially high costs to employers. For example, older workers may have higher healthcare costs, and health concerns with an aging population could also lead to decreased productivity.

Oakley noted that the most powerful tool for employers to encourage employees to start saving for retirement is automatic enrollment. Workers are enrolled in savings plans as soon as they’re eligible, so they don’t lose time in signing up and are less likely to opt-out.

Should the work day end at 3 p.m.?

Last week, we briefly discussed the debate over the benefits of a four-day work week.

This week, Wharton professor Adam Grant suggests that we make work days end at 3 p.m. Grant’s suggestion comes in response to an Atlantic article that asks why the school day ends two hours earlier than the work day.

The article further discusses how parents are squeezed by after-school or private child care costs – or lack of available after-school options – which puts a strain on families. The net result is that the conflicting school and work schedules lead to losses in productivity and parents (mostly women, the article notes), cutting back on employment.

So Grant’s solution, via a post on LinkedIn, is to make the work day shorter – a more productive and focused six hours versus an unfocused eight hours.

Quartz, reporting on the issue, says: It’s a suggestion in line with a growing movement across industries to rethink long-standing norms about how work should get done—norms created in an earlier economy, at a time when the technology to accommodate flexible work did not exist. 

It’s true that employers are working towards new models of work that meet the expectations and realities of today’s workforce. However, as with the four-day work week, Quartz notes that shortening the workday would require broader and fundamental systemic changes to ensure the change isn’t counterproductive.

We’re becoming less smart

According to Psychology Today, IQ scores have been rising “for nearly as long as people have been taking tests” – until now.

Psychology Today notes that researchers have long believed that IQ increases are due to environmental factors like improvements to diet, education, and access to information. But now, the so-called Flynn Effect is reversing, and IQ scores are decreasing. According to a recent study by Bernt Bratsberg and Ole Rogeberg of the Ragnar Frisch Centre for Economic Research in Norway, the decrease is also caused by our environments.

What are these environmental factors? Time says they include “differences in the way young people are educated, increases in time spent online, changes in nutrition, and less reading overall.”

Sounds like a good reason to spend some time outside, read a book, and eat a healthy breakfast this weekend.

Danielle Ng-See-Quan

Dani is the Senior Manager, Content Marketing at Ceridian.

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