Organizational resilience is a success factor for large organizations. In Canada, maintaining that resilience is an increasingly difficult task, because organizations are made up of people…and Canadians are facing a growing financial and retirement crisis. Financial stress is more than a personal issue — it’s a productivity killer.
Over half of working Canadians report that financial anxiety affects their job performance, and nearly 50% say it disrupts their sleep; 42% of Canadians say money is their top source of stress, surpassing health and work-related concerns (FP Canada, 2025). Ninety-one said financial benefits such as retirement savings plans impact their commitment to their employer, in a survey by Benefits Canada.
From the employer’s perspective, the retirement landscape is also going through some big changes that should affect wealth benefits planning. Alight researches and monitors trends in financial wellbeing and institutional wealth management, among other areas.
For this article, we’ve summarized some of the research we presented to our Canadian clients earlier this year. Here are five factors reshaping Canada’s financial wellness and retirement landscape, key statistics, and ideas for employers matched with each one, to help HR leaders considering strategic changes to improve organizational resilience.
Inflation is threatening retirement confidence
Key Statistics: 29% of Canadians expressed concern about the impact of rising inflation on their retirement savings, according to a new survey by the Royal Bank of Canada. Sixty-three percent of Canadians worry that inflation will erode their retirement savings (Healthcare of Ontario Pension Plan, 2025).
With the average CPP (Canadian Pension Plan) and OAS (Old Age Security) income totaling just $15,159 annually, many Canadians have a good reason to fear they’ll outlive their savings.
Employer resilience strategy:
Offer inflation-adjusted retirement planning tools and employer-matched RRSPs (Registered Retirement Savings Plans) or TFSAs (Tax Free Savings Accounts). Tailor financial education to younger employees, 80% of whom feel unprepared for retirement. And because retirement planning doesn’t happen in a vacuum, consider implementing holistic financial wellness programs that include budgeting tools, debt counseling, and access to certified financial planners, and access to loans that can help employees avoid borrowing from their retirement savings. Employees who receive financial guidance are 25% more likely to feel hopeful about their financial future.
Employees who receive financial guidance are 25% more likely to feel hopeful about their financial future.
- Pension plans and financial risk — investment strategies need attention
Key Statistic: The Mercer Pension Health Pulse (MPHP), a measure that tracks the median solvency ratio of the Canadian defined benefit pension plans in Mercer’s pension database, improved to 125% as of December 31, 2024, compared to 116% as of December 31, 2023.
Employer resilience strategy:
Pension plans with benefit payments that exceed the contributions may need to have a heightened awareness of financial risks posed by the negative cashflow. Regularly review the pension plan’s investment policy. Such reviews may be expanded to include incorporating sustainable investment strategies.
- MEPPs offer scalable retirement solutions
Key Statistic: 81% of members in Saskatchewan’s Public Employees’ Pension Plan report high satisfaction with their MEPP. Multi-Employer Pension Plans (MEPPs) are gaining traction as a cost-effective, low-risk retirement solution — especially for small and mid-sized employers.
Employer resilience strategy:
Explore MEPPs to reduce fiduciary burden and administrative costs. For MEPPs, the biggest driver for both employers and plan members are the economy of scale, which allows for greater risk-sharing, lower management fees and a reduced administrative burden. They can be a good solution for organizations unable to meet the fiduciary requirements of maintaining their own plan. Plan to educate employees on the benefits of pooled retirement plans — this can help with the organization’s transition to a MEPP.
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- Climate risk is a pension time bomb
Key Statistic: U.S. and Canadian pension fund returns could fall up to 50% by 2040 if predictions for the worst global warming materialize and if the current approach to climate policy doesn’t change, according to Ortec Finance, a provider of technology and risk management solutions for financial institutions. Eleven of Canada’s largest pension fund managers (who collectively manage $2.4 trillion) have acknowledged climate change as a substantial financial risk.
Employer resilience strategy:
Be aware of how pension fund managers are planning for climate risk. One excellent resource is Shift’s annual pension report card — it analyzes the climate policies of 11 of Canada’s largest pension managers.
- Demand for pension risk transfers is increasing
Key Statistic: Canadian employers are increasingly transferring pension liabilities to insurers to de-risk their balance sheets and ensure stable retiree incomes. Canadian pension risk transfers reached US$11B in 2024, according to a recent report by Sun Life. Of the US$11B in transactions, US$3.3B were for inflation-linked annuities. The demand for inflation-linked annuities was only US$2.5B for the three-year period from 2021 to 2023.
- Employer resilience strategy:
- When employers transfer pensions to insurers, plan members always have questions about what this means for their retirement. Communicate clearly with plan members, explaining the reason for the change as well as security precautions to protect their assets.
At Alight, we’re committed to serving our clients in Canada, and providing them with the resources they need to become resilient organizations. Our broad range of expertise empowers employers to navigate the complexities of retirement benefits and financial wellness as the Canadian pension landscape evolves.
We help you build strategies that will safeguard your employees' futures and ensure stability in Canada’s changing retirement landscape. Our local expertise, global insights, and forward-thinking approach enable us to design and deliver retirement solutions that focus on long-term outcomes.
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