The Race/Ethnicity Gap in Retirement Plan Participation: More than Just Demographics

11 Pages Posted: 12 Apr 2024

Date Written: March 12, 2024

Abstract

American companies have been actively shifting away from defined benefit (DB) plans towards defined contribution (DC) plans for decades. This shift places more burden on workers to make decisions like whether to participate in the retirement plan, how much to save, and how to invest those savings. This analysis explores how participation in a workforce retirement plan varies by race and ethnicity leveraging data from the Annual Social and Economic Supplement (ASEC) to the 2023 Current Population Survey (CPS).

The research demonstrates that underrepresented American workers are less likely to have access to a retirement plan at work and are less likely to save in one when it’s available. These effects persist even after controlling for variables such as gender, marital status, age, income, employer size, education level, industry, occupation, as well as race and ethnicity. Overall, this analysis suggests underrepresented American workers face a unique set of barriers when it comes to participating in workforce retirement plans, which may have significant long-term implications on the retirement security of these groups.

Suggested Citation

Blanchett, David, The Race/Ethnicity Gap in Retirement Plan Participation: More than Just Demographics (March 12, 2024). Available at SSRN: https://ssrn.com/abstract=4756707 or http://dx.doi.org/10.2139/ssrn.4756707

David Blanchett (Contact Author)

PGIM ( email )

Prudential Tower
655 Broad Street, 19th Floor
Newark, NJ 07102
United States

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