EBRI study: Workplace retirement plan participation has risen since crisis

Rates for plan sponsorship, participation still lower than 2003 peak

More workers have access to workplace retirement plans, and participation rates in plans are rising, too, according to a new report by the non-partisan Employee Benefit Research Institute.

The percentage of all workers age 16 or older with access to a workplace pension or retirement plan rose to 61% in 2012 from 59% in 2009. The percentage of workers participating in a plan increased to 46% from 45% in the same period.

As the economy continues to recover, “it's positive that there is more retirement plan participation,” said Craig Copeland, EBRI senior research associate and author of the study, in an interview. “Part of the recovery is more employers offering plans, (and) it looks like people are starting to use the plans again.”

EBRI uses data from the U.S. Census Bureau's latest Survey of Income and Program Participation, which covers retirement plan participation from December 2011 to March 2012. The SIPP, which is collected every three to five years, shows that the highest level of plan sponsorship was 63% in 2003, which also saw a peak participation rate of 48%.

Mr. Copeland attributed the 2012 gains to a combination of factors, including the economic recovery, more auto enrolment in defined contribution plans, and the prevalence of defined contribution over defined benefit plans. In the survey, 78% of workers considered defined contribution their primary plan, compared to 21% for defined benefit plans.

“Now that you have the recovery and auto enrolment, people are seeing the defined contribution plan as the plan that is going to provide the most benefit,” Mr. Copeland said.