A pandemic, a vaccine, and a sea of ideas

The COVID-19 pandemic has been breathtaking in its ability to unleash profound effects on nearly everyone in the world. Equally breathtaking are the biomedical advances that have enabled 47 vaccine candidates to reach clinical evaluation in recent months.1

News on Monday, November 9, that one of those vaccine candidates appears to protect a vast majority from COVID-19 is raising the confidence of investors and public health experts alike. Vanguard earnestly hopes that further study confirms the good news and that a vaccine can be approved in the months ahead for broad use. It’s conceivable that more of the vaccine candidates can report similar efficacy in the weeks ahead.

We’re not surprised that this point was reached so quickly. The fields of genetics and biomedicine have been rife with innovative ideas in the last decade, and successes seem poised to have a cascading effect on productivity in the decade ahead. It’s a phenomenon we identified in The Idea Multiplier, our 2019 research that found that future productivity is fundamentally driven by the generation, dissemination, and further expansion of ideas.

Idea sharing: A significant force for productivity growth

Our research introduced what we termed the “Idea Multiplier,” a quantifying over time of academic-paper citations within and across industries and countries based on nearly two billion records. We found that idea sharing is a significant force for future productivity growth, and that a recent low-growth era was nearing an end.

The illustration shows how the Idea Multiplier as it’s related to genetics and biomedicine has recently accelerated at a pace similar to that of computers and telecommunications nearly four decades ago.

Today’s ideas in genetics and biomedicine are multiplying quickly

Notes: The Idea Multiplier is a proprietary metric that tracks the flow and growth of academic citations. It has been shown to be a leading indicator of productivity growth. For more information, see the Vanguard paper The Idea Multiplier: An Acceleration in Innovation Is Coming.

Source: Vanguard.

We won’t let our optimism about vaccine developments cause us to lose sight of the immense challenges ahead. The spread of COVID-19 is accelerating, too, with more than 50 million cases reported globally to date and more than 100,000 new daily infection cases in some countries, including the United States, recently.2 Production and distribution of a vaccine will take time.

Economies have recovered somewhat from the sharp falls they had suffered since the onset of the pandemic, but even a highly effective vaccine won’t lead to stronger economic growth overnight. Nevertheless, this crisis will eventually end, and this week brought a tangible signal of that, one we know was a decade of idea-sharing in the making.

1 Source: World Health Organization, November 3, 2020.

2 Source: Johns Hopkins Coronavirus Resource Center, November 9, 2020.

Notes:

• All investing is subject to risk, including the possible loss of the money you invest.

What you need to know to navigate year-end processing with ease.

As the end of the year approaches, so do deadlines for key processing requirements. It’s critical to ongoing plan health and compliance that these deadlines are met. For a comprehensive list of actions and due dates, reference our year-end guide on the plan website under Resources.

Are you ready to comply with broadened eligibility requirements?

As a plan sponsor, you’re required to ensure all eligible employees can participate in the plan.

The SECURE (Setting Every Community Up for Retirement Enhancement) Act recently broadened 401(k) plan eligibility requirements to include long-term part-time employees for plan years beginning January 1, 2021. Employees who are 21 and older who work at least 500 hours in three consecutive 12-month periods can participate in the plan.

We can help ensure your records are accurate for the first employees to benefit from this change in 2024. All you have to do, if you’re not doing so already, is make sure to submit payroll information, including hours, for all employees regardless of how many hours you expect them to work. With this information, we’ll track when they’re eligible to participate in the plan under the new rules.

Take advantage of the latest digital enhancements for you and your employees.

Here are some of the latest improvements to how you and your employees engage with your plan—from simplifying payroll to helping employees manage their retirement accounts.

For you: Track contributions with ease

Access the information you need when you need it—and stay confident knowing payroll contributions are accurate, on schedule, and processed in a timely manner.
New payroll functionality allows you to track contributions directly from the plan website. For users with payroll administrator access, real-time validation of contribution and census data ensures accuracy, while a simplified file upload saves time—so your focus remains on your business.

Reminder: Please confirm that we have your correct payroll provider on file by visiting the Plan Overview section of the plan website.

We look forward to sharing more enhancements with you in the new year.

For your employees: New mobile app keeps them engaged on the go

With the launch of the READYSAVE™ mobile app this summer, and new features added regularly, it’s easy for employees to access their accounts—from anywhere.

Last year, the Retirement Outlook tool on the employee website inspired 36% of employees who used it to update their savings strategy (Source: Ascensus, December 2019). Now, your employees can use this tool within READYSAVE™ to analyze potential outcomes and take action.

To help your employees get up and running with READYSAVE™—and stay connected to the plan—share the Digital Capabilities Guide, which can also be found on the plan website under Resources > News & Communications.

IRS issues new guidance on extended rollover periods for certain plan loan offsets.

The Tax Cut and Jobs Act of 2017 extended the rollover period for qualified plan loan offset (QPLO) amounts. The IRS recently released proposed regulations, which can be relied upon today, to clarify how this extension applies. If the plan has a loan provision, it's important to understand any implications for your employees. Read our recent article.