Lack of employee benefits available to the nation’s growing force of part-time workers makes them particularly financially vulnerable, according to new research from Guardian Life released on July 10.
The research – from “Part-Time Nation,” the latest set of findings from the Fourth Annual Guardian Workplace Benefits Study – reveals that a greater number of working Americans are participating in the “Gig Economy” (estimated to be about 25% of the U.S. labor force or roughly 40 million). These are people working in part-time, independent contractor, or contingent positions rather than full-time, permanent jobs, particularly in industries like hospitality, healthcare, and retail. Although employment offers some security, the study shows that a lack of employee benefits for part-time workers has made them financially vulnerable.
Of those employed on a part-time basis (27 million or 18% of all U.S. workers), three-fourths choose to work part-time to achieve a better work-life balance. The majority are younger Millennials (age 22-29) who are just starting their careers and pre-retiree baby boomers (age 60 and older) who are reducing their work hours. In exchange for a flexible work schedule, many part-timers are falling behind financially because part-time workers and contractors are often ineligible for insurance or retirement benefits from their employer.
Guardian’s research found that:
• One in three part-timers have an employer-sponsored retirement plan (compared to 69% of full-timers).
• Only 25% of part-timers have an employer-sponsored medical plan (compared to 80% of full-timers).
• Less than 20% of part-timers have dental, disability, or life insurance benefits at work (compared to more than half of full-timers).
“More Americans are seeking greater autonomy and flexibility in their career than they can find in the traditional nine-to-five model,” said Peggy Maher, senior vice president and head of Guardian’s direct-to-consumer business. “While pursuing a passion and achieving greater work-life balance are indeed major advantages of alternative work arrangements, the lack of important insurance and retirement benefits can negatively impact financial security for themselves and their families. For those part-timers without access to workplace benefits, the good news is that these products are increasingly available through a variety of channels.”
The study highlights that most part-time workers feel they are faring well financially, but this may be a false sense of security from a lack of understanding on how employer benefits can provide financial stability. Two demographic groups that do not feel financially confident are Generation X and single parents, who cite money and personal finances as the primary source of stress in their lives.
Employers that are anticipating an increase in part-time and contract workers can better compete for talent, the study says, by providing their workforce with employer-sponsored benefits. “This will ease the financial stress of their part-time employees, possibly reduce turnover, and clearly define the added value available to their entire workforce,” says a news release announcing the findings.
For more information about Part-Time Nation from the Fourth Annual Guardian Workplace Benefits Study or to obtain a copy, please visit Guardian Anytime.
About Guardian: The Guardian Life Insurance Company of America® (Guardian) is one of the largest mutual life insurers, with $7.4 billion in capital and $1.5 billion in operating income (before taxes and dividends to policyholders) in 2016. Founded in 1860, the company has paid dividends to policyholders every year since 1868. Its offerings range from life insurance, disability income insurance, annuities, and investments to dental and vision insurance and employee benefits. The company has approximately 8,800 employees and a network of over 2,750 financial representatives in 58 agencies nationwide. For more information visit http://www.GuardianLife.com.