Not since 2010 has the percentage of workers participating in an employment-based retirement plan risen, but in 2013 it finally did.
So says a report from the Employee Benefit Research Institute, which found that in 2013, the percentage of all workers rose from 2010's level of 39.7 percent to 40.8 percent.
The number of workers participating was actually the highest since 2007, hitting 64.2 million. And in general, according to EBRI, each category of workers was at its highest level of participation since the economic recession began in 2008.
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"Retirement plan participation by workers is tied to macroeconomic factors such as the labor market, in addition to various demographic factors," said Craig Copeland, senior research associate at EBRI and author of the report, in a statement. "Other underlying factors also have an impact, but higher employment generally leads to higher levels of retirement plan participation."
The degree of improvement in participation rates depends on the type of worker being considered, the report also said. For all American workers in 2013, 51.3 percent worked for a union or an employer sponsoring a retirement plan (the sponsorship rate), and 40.8 percent participated in a plan. Wage and salary workers aged 21–64 experienced a sponsorship rate of 56.0 percent; 45.8 percent participated.
The sponsorship rate for full-time, full-year wage and salary workers in that same age group was 62.3 percent, with 54.5 percent participating. And the highest participation rate was among wage and salary public-sector workers, with almost 74 percent participating.
Demographics also serve as indicators of whether a worker will have a plan in which to participate. White workers had a high probability of participating in a plan, while Hispanic wage and salary workers were not only less likely than both black and white workers to participate. Native-born Hispanics, however, participated at a higher rate than non-native-born Hispanics. And the gap between black and white participants narrowed as earnings levels went up, with blacks surpassing whites when income hit $75,000 or more.
Education levels also indicated the likelihood of participation, even when controlling for the difference higher education makes in bringing higher income. Those with lower incomes were more likely not to participate, with those lacking high school diplomas coming in at the bottom of participation rates.
The percentage of women participating was lower overall, but when controlling for work status or earnings, women beat men in participation in 2013. People working for large companies were more likely to participate, and even geographic location played a role in determining participation rates—with wage and salary workers ages 21–64 living in Florida having the lowest probability (38.3 percent) of participating in a plan in 2013; those living in Iowa had the highest probability (56.9 percent).
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