A new survey from the Transamerica Institute, based on responses from 1,900 employers and over 6,100 workers in late 2025, highlights a persistent disconnect between corporate confidence and employee financial reality. While 78% of employers expressed optimism about their company's future, only 56% of workers felt optimistic about their own prospects—a 22-percentage-point gap that permeates nearly every financial metric in the report, titled "Employers, Workers, and the New World of Work."
"As AI promises to revolutionize business models, employers are upbeat about the future, but they may be overlooking their most valuable asset—their employees," said Catherine Collinson, CEO and president of Transamerica Institute and its Transamerica Center for Retirement Studies. "It takes people to implement and operationalize new technologies and, right now, workers are stressed and strained in today's economy."
Retirement Savings Divide
The retirement savings data is among the most striking findings. The median total household retirement savings across all surveyed workers in 2025 was $78,000. However, this figure masks severe stratification by employer size: workers at small companies had saved a median of just $53,000, compared to $85,000 at medium firms and $121,000 at large ones. Although 84% of employers said they were confident their workers would achieve a financially secure retirement, only 69% of workers expressed that confidence.
Ninety-one percent of workers said a 401(k) or similar plan is important to them, yet only 61% of employers offer one. Among small companies, 37% offer no retirement benefits whatsoever, compared to just 4% of medium companies and 1% of large companies. Among 401(k) plan sponsors, 96% make some form of employer contribution, and 94% offer professionally managed investment options such as target date funds or managed accounts. Eight in 10 (85%) plan sponsors agreed that their employees would like more guidance on reaching their retirement goals—a view echoed by 73% of workers who are offered a plan.
Automatic enrollment remains underutilized: only 27% of plan sponsors have adopted it, though large and medium companies are ahead at 34-35%. For those that have implemented it, the default contribution rate sits at a median of 8%, and 79% report positive employee response. Automatic escalation has been more broadly adopted, with 73% of plan sponsors having that feature in place. The SECURE 2.0 Act continues to reshape the landscape; beginning in 2027, the Saver's Credit will be replaced by a new Saver's Match—a federal government matching contribution for eligible savers. Currently, 65% of 401(k) sponsors both know about the Saver's Credit and actively promote it, but 14% remain unaware of it entirely.
Only 44% of plan sponsors offer pre-retirees access to a financial advisor, 39% provide an array of income solutions, and just 27% offer guaranteed income as a payout option. Some 84% of employers that offer no retirement benefits do nothing to help workers transition their savings as they near retirement. Advisors may find parallels in recent research, such as the JPMorgan strategist's call to separate math from emotion in retirement planning, or the emphasis on sequence-of-returns analysis as a key risk variable.
Inflation and Emergency Savings Gaps
Inflation is exacerbating the strain. Some 86% of employers acknowledged that inflation makes it harder for employees to save for retirement, and 78% of workers said the same about their own situation. Seventy-five percent of workers reported taking at least one action due to financial strain from inflation in recent years, such as cutting everyday expenses, dipping into savings, or picking up extra work. Fifteen percent tapped their retirement accounts, and one in four took on a second job or side hustle. Employer awareness of that side-hustle reality creates tension: more than half of employers (54%) said they have concerns when employees take on additional income sources outside of work—even as those same employers broadly acknowledge why workers are doing it.
Nearly three-quarters of employers believed their workers had enough set aside to absorb a major unexpected financial shock, but in reality, one-third of workers had saved less than $5,000 for emergencies, and 14% had nothing saved at all. The median emergency savings figure among all workers was just $5,000. Financial literacy compounds the problem: 39% of employers believe their workers have strong personal finance knowledge, while only 21% of workers describe themselves that way. Seven in 10 employers (71%) agreed that their employees don't know as much as they should about retirement investing—a view shared by 61% of workers themselves. Yet only 26% of employers offer a financial wellness program as part of their benefits package. For advisors, this underscores the opportunity to engage plan sponsors, as highlighted by the Ascensus acquisition of AmericanTCS to bolster retirement tech, and the persistent retirement anxiety revealed in Gallup and Ameriprise surveys.
