Nearly half (47%) of U.S. private-sector full-time and part-time workers over age 18 — or more than 59 million people — do not have access to a workplace retirement savings plan, according to a new report from the Georgetown University Center for Retirement Initiatives.
And that’s not counting “gig economy” workers with nontraditional employment arrangements. Georgetown CRI estimates that an additional 23.4 million gig workers also lack access to retirement plans, bringing the total number of workers without plans to 82.4 million.
“As the gig economy grows as a share of the workforce, access to retirement savings for this population becomes an increasingly important policy consideration,” Georgetown CRI said in the report.
Georgetown CRI projects that the number of elderly Americans — those over age 65 — is expected to jump 34% to 75 million by 2040 from 56 million in 2020, an increase that will strain federal and state government social programs.
Georgetown CRI calculates that 23% of elderly households nationwide derive at least 90% of their family income from Social Security, based on data from 2022 to 2024.
"Too many of the elderly in the United States already rely almost exclusively on Social Security," the report said. "Because the United States’ senior population will grow significantly, boosting private retirement savings is crucial to supporting a better quality of life for seniors and greater economic activity from their household spending, while constraining growth in the costs of government support programs."
To alleviate the problem, Georgetown CRI endorses the creation of state-run retirement savings programs that have been popping up in states across the country. To date, some 20 states offer the programs, giving some 20.6 million workers in those states access to a workplace retirement savings plan they otherwise would not have, according to Georgetown CRI.
The earliest adopters of state auto-IRA retirement savings programs — OregonSaves launched in 2017, Illinois Secure Choice in 2018 and California’s CalSavers in 2019 — have amassed more than $1.6 billion in assets, as of Dec. 31.
The programs have meaningfully expanded access to retirement saving plans to workers in the three early adopter states due to what Georgetown CRI describes as the “combined effect of program participation and induced new retirement plan formation.”
For example, of the estimated 995,000 workers who have access to retirement savings in Oregon, Georgetown estimates that 234,000 gained access through OregonSaves and an additional 36,000 have been covered through new private retirement-plan formation.
The auto-IRA programs require employers not offering workplace retirement savings plans to automatically enroll their workers in the state programs. Rather than go with the state programs, some employers opt to launch their own plans.
