The slow climb out of recession has workers mired in skepticism about their ability to recover financially. And it looks like their pessimism will be reflected in the November elections. In a national survey released Tuesday by Sun Life Financial Inc., a majority of respondents said they plan to vote against any incumbent regardless of political party affiliation.
The economic climate and financial insecurity creates a gloomy outlook that permeates the finding of Sun Life's latest Unretirement index. In Oregon, the jobless rate for September was still 10.6 percent, a percentage point higher than the national average of 9.6 percent.
More than 80 percent of workers believe they will need at least three years to rebuild their retirement savings as a result of the recession. That's a dramatic increase over the 64 percent who responded to the survey a year ago.
Some 20 percent of workers believe they will never get their savings back to pre-recession levels, the survey revealed.
The Unretirement index was created in 2008 as the financial crisis deepened. The survey focuses on how workers are reacting to economic conditions and how their behavior and retirement plans are changing.
"Even though the headline news is that we're through the recession, the average person doesn't really see it and in fact they are still feeling it," said Wes Thompson, U.S. president of Sun Life Financial. "They were assuming things would have gotten better by now and it has not from their point of view." Indeed, more workers are saying that the economic crisis will delay their retirement plans by a year or more. This year 64 percent of workers reported delayed plans. That's up from 54 percent in 2008. More than half of workers responding — 52 percent — expect to work at least three years longer than originally planned.
Delayed retirement, along with the belief that Social Security and Medicare will not be there when they retire, has soured workers on the government and policymakers, which means it's a bad time to be an incumbent.
The number of workers who are confident they will receive retirement benefits at a level comparable with today's retirees reached a new low for Social Security, Medicare, and medical benefits from an employer.
The results show:
- 14 percent of respondents are very confident in Social Security, down from 22 percent.
- 16 percent are very confident in Medicare, down from 20 percent.
- 22 percent are very confident in receiving medical benefits from an employer, down from 25 percent.
While workers in France are striking in protest of President Nicolas Sarkozy's plans to increase the retirement age to 62 from 60, workers in the United States have resigned themselves to the reality that they'll still be working at age 67 and beyond.
Nearly half of today's workers believe they will still be working at age 67 and one quarter of workers believe they'll be working full time at that age, an increase from the 19 percent that thought so in 2008.
The survey shows workers are similarly worried about their future quality of life.
Less than half of respondents — 42 percent — are very confident that they will now be able to take care of basic living expenses in retirement. Only 1 in 4 have strong confidence that they will be able to take care of medical expenses.
So, what are people doing with all this skepticism? They're hunkering down by cutting their spending, with 71 percent saying they're reducing spending and 66 percent reducing debt.
The most common places to cut spending were on entertainment, restaurants, holiday shopping and delaying the purchase of a car or a home improvement project.
For the survey, telephone interviews were conducted in September with 1,201 randomly selected people identified as working full- or part-time jobs. The statistical margin of error is plus or minus 2.8 percent.