Employers have critical role to play to deal with looming benefits costs

A report, Transforming Pensions and Healthcare in a Rapidly Ageing World: Opportunities and Collaboration Strategies, published by The World Economic Forum with the support of Mercer and the Organisation for Economic Cooperation and Development (OECD) shows that the ratio of elderly persons to the working-age population will dramatically increase in coming years in many parts of the world.

This will result in a declining labour force, an ageing population and looming health care and pension benefit costs.

In conjunction with the World Economic Forum report, Mercer has published a special Perspective in which the firm’s leading authorities draw upon practical experience consulting in retirement, health care and workforce management.

Governments, Mercer observes, set the rules within which employers must operate and also create the background environment. If a dialogue between governments and employers is based only around an equation about the cost and adequacy of benefits, this may well become confrontational.

Alternatively, constructive dialogue may create 'win win' scenarios if employers, encouraged by or in concert with governments, take initiatives such as promoting work for older people, providing financial education, improving the processes for savings or improving annuities to make the exchange of lump-sum payouts more effective.

Download the report and a related Mercer Perspective