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Our consensus about the value of company pensions is being undermined by inflation and high interest rates.

There is no “anti-pension” movement, although the Alberta government’s proposal to exit the Canada Pension Plan (CPP) has an echo of this line of thinking. The questioning of pensions today is much more about prioritizing money at a time of soaring living costs. Can money be better spent today than put away for tomorrow?

It must seem that way right now if you’re trying to save a home down payment, or if your mortgage and grocery payments have increased. But having the discipline of a pension imposed on you is a huge long-term advantage, even if it seems unfair in the near term. The most valid criticism of pensions today is that too few workers have them.

Tension about pensions is evident in data presented by the Healthcare of Ontario Pension Plan (HOOPP) as part of its advocacy work promoting workplace retirement-savings programs. In a recent survey of 754 businesses with 20-plus employees, almost two-thirds of participants said their employees would prefer a higher salary over a better pension.

What makes this finding especially noteworthy is the high level of commitment many employers in the survey have to pensions. Almost one in four said they were introducing or enhancing retirement benefits this year or next, up 6 percentage points from 2022.

Rob Carrick: A guide to starting CPP and OAS benefits when you retire – and yes, it’s on you to do that

Top reasons for offering retirement benefits include employee retention, recruitment and helping to reduce financial stress. A strong majority of employers agreed retirement benefits are a cost-effective way to lower employee financial stress and improve productivity.

HOOPP found in a previous survey conducted last spring that almost seven in 10 workers would prefer a slightly lower salary to get a pension, period, or an improved pension. And yet, there’s a clear sense among employers that many of their workers want more money in their hands now as opposed to contributions to a pension for retirement.

Statistics Canada says the proportion of workers covered by a pension plan was 38 per cent in 2021, down from 39.7 per cent in 2020. The value put on pensions in today’s world is captured by the phrase “pension envy,” used to describe resentment toward public sector workers and others who will have pensions in retirement.

In the eighth season of The Globe and Mail’s Stress Test podcast for Gen Zs and millennials, Globe personal finance editor Roma Luciw and I plan to dig into the views young workers have about pensions. What we already know is that their financial challenges include student debt, soaring rents, expensive house prices and high mortgage costs.

A recent story on the CNBC website suggests another angle on pension and young people. The story notes a “soft saving trend” in which young adults prioritize improving their lives today over saving for the future. Ironically, there was a link on the same web page for a story headlined: “Around 30 per cent of young people want to retire as millionaires – and over half are confident they can do it.”

The Alberta government’s proposal to withdraw from the CPP and create a provincial plan can be seen as an affirmation of the importance of pensions. But the idea is being sold in part as a way to address the financial burden of pension contributions.

The sales pitch for an Alberta pension plan includes lower premiums and better benefits, made possible in theory by the province’s younger demographic. This means more workers and employers contributing to the plan right now with fewer retirees receiving benefits.

CPP and OAS: How the financial supports affect your retirement plans

Starting an Alberta pension plan as an alternative to the time-tested CPP seems an unnecessary risk, especially given the unknown costs of building a parallel pension bureaucracy and uncertainties about Alberta’s economy in a world trying to move away from fossil fuels.

A more subtle threat is that the initiative reinforces the idea of pensions as a consumer good where the cheapest deal rules. Pensions with a history of reliable benefits have a cost that is worth enduring, even in times like these when paying the mortgage and buying food can seem unmanageable.

The HOOPP survey tells us that having a company pension or retirement savings plan is still considered an advantage in attracting and retaining staff. The importance of pensions can be seen as well in the recent contract agreement between Ford of Canada and its workers. Significant pension upgrades were a centrepiece of the deal.

And yet, a majority of employers in the HOOPP survey believe their employees want money more than pensions. With a recession looming and no quick end in sight for high interest rates, expect more questioning of the pension consensus.

For an upcoming episode of the Stress Test personal finance podcast, we want to hear from Gen Zs and millennials about their views on pensions. Would you prefer not to contribute to a company pension so you could spend the money elsewhere? Do you feel pension envy when looking at older generations? If you’re willing to talk, please reach out to producer Anna Stafford at

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