Tuesday, July 26, 2016

Workplace Retirement Plans, 2016

Are workplace retirement plans a benefit for the affluent? That's what the data suggest. The latest report from the Bureau of Labor Statistics reveals the stark retirement benefit divide between low-wage and high-wage workers. Among private-sector workers overall, 66 percent have access to a workplace retirement plan—meaning their employer offers a plan and they are eligible to participate. But access varies greatly by wage quartile...

Percentage of private-sector workers with access to a workplace retirement plan
Lowest wage quartile (less than $12.40/hour): 42%
Second wage quartile ($12.40 to $18.51/hour): 65%
Third wage quartile ($18.52 to $29.79/hour): 78%
Highest wage quartile ($29.80 or more/hour): 87%

It gets worse. Among workers with access to a retirement plan, only 22 percent of those in the lowest-wage quartile participate in their employer's retirement plan versus 76 percent of those in the highest-wage quartile. For low-wage workers, even these meager rates likely overstate reality because they exclude agricultural and private household workers.

Source: Bureau of Labor Statistics, Employee Benefits in the United States—March 2016

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