The Employee Benefit Research Institute found that more workers "were offered, participated in, and were vested in a retirement plan" in 2003 than in 1998, according to a study released today. EBRI's last such study was done five years ago. The new study found that 63% of workers 16 and older worked for an employer or union that sponsored a retirement plan in 2003, up from 60% in 1998, and 48% of workers were in a retirement plan in 2003, up from 44%. Also, 44% of workers are entitled to some pension benefit or lump-sum distribution upon leaving their jobs, up from 41% five years ago.
The higher a worker's income, the more likely he or she participated in a retirement plan, the study showed. Of those who made at least $50,000 in 2003, 79% participated in a pension plan, compared with 13% of workers who made less than $5,000 a year
In private-sector industries, participation ranged from a low of 30% of workers in retail to highs of 66% and 64% in mining and manufacturing, respectively, in 2003. In the public sector, 74% of workers participated in plans.
"The data also demonstrate the well-documented shift away from 'traditional' defined benefit pension plans and toward defined contribution plans such as 401(k) plans in the private sector," the study said. "A defined contribution plan was the primary retirement plan for 57.7% of participants in 2003, up from 51.5% in 1998 and more than double the 1988 level. Correspondingly, 40.5% reported a defined benefit pension plan was their primary retirement plan in 2003, down from 46.3% in 1998 and 56.7% in 1988."
The EBRI study is based on the U.S. Census Bureau's most recent survey of income and program participation data for 2003.