Are US Workers Ready for Retirement? Trends in Plan Sponsorship, Participation, and Preparedness

Journal of Pension Benefits, Ferenczy Benefits Law Center, Winter 2015. pp. 25-39

15 Pages Posted: 10 May 2015

See all articles by Teresa Ghilarducci

Teresa Ghilarducci

Schwartz Center for Economic Policy Analysis (SCEPA); The New School for Social Research

Joelle Saad-Lessler

The New School for Social Research

Kate Bahn

New School for Social Research

Date Written: 2015

Abstract

Most workers need a workplace retirement plan to supplement their Social Security to achieve an adequate retirement income — defined here as a 70 percent replacement rate at age 65. However, only 44 percent of workers in the United States participate in a retirement plan at work. The lack of retirement readiness is not caused by the Great Recession but by two structural trends: not enough people have access to a retirement plan at work and, when they do, the amounts saved are often not enough to ensure adequate retirement living standards.

Between 1999 and 2011, the availability, distinct from participation, of employer-sponsored retirement plans in the United States declined from 61 percent to 53 percent. [Ghilarducci, Teresa and Saad-Lessler, Joelle. “Explaining the Decline in Offer Rate of Employer Retirement Plans Between 2001-2012,” Schwartz Center for Economic Policy Analysis and Department of Economics, The New School for Social Research, Working Paper Series, 2014. Forthcoming in the Industrial and Labor Relations Review.] All workers, regardless of sex, race, industry, firm size, and union status, experienced a drop in coverage rates. However, being in a union was somewhat protective; union workers experienced a 6 percent drop in coverage while non-union worker rates dropped 14 percent.

Keywords: Retirement policy, Pension Benefits, Guarantee Retirement Accounts

Suggested Citation

Ghilarducci, Teresa and Saad-Lessler, Joelle and Bahn, Kate, Are US Workers Ready for Retirement? Trends in Plan Sponsorship, Participation, and Preparedness (2015). Journal of Pension Benefits, Ferenczy Benefits Law Center, Winter 2015. pp. 25-39, Available at SSRN: https://ssrn.com/abstract=2604299

Teresa Ghilarducci (Contact Author)

Schwartz Center for Economic Policy Analysis (SCEPA) ( email )

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5th Floor
New York, NY 10027
United States

The New School for Social Research ( email )

6 16th Street
New York, NY 10003
United States

Joelle Saad-Lessler

The New School for Social Research ( email )

6 East 16th Street
New York, NY 10003
United States

Kate Bahn

New School for Social Research ( email )

6 East 16th Street
New York, NY 10003
United States

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