Retirement Plan Participation Stable Since 2011

November 12, 2013 ( – Participation in employer-sponsored retirement plans has been generally stable since 2011.

An analysis by the Employee Benefit Research Institute (EBRI), based in Washington, D.C., finds the number of employees participating in plans has increased slightly, although the level of participation is down slightly. Based on U.S. Census Bureau data, EBRI says the number of employees participating in a plan rose from 61 million in 2011 to 61.6 million in 2012. Balancing this out was the fact that the percentage of those who participated dropped slightly to 39.4% in 2012, compared with 39.7% in 2011.

The EBRI notes in its analysis that retirement plan participation by employees is strongly tied to macroeconomic factors such as stock market returns and the labor market. The stronger macroeconomic conditions of the late 1990s produced higher levels of participation, while less-positive macroeconomic conditions of the 2000s led to lower levels of participation.

“The current economic environment is likely to result in 2013 participation numbers that are very similar to 2012, with the potential for a slight increase, though many other underlying factors will continue to affect the future direction of this trend,” says Craig Copeland, senior research associate at EBRI and author of the analysis.

The analysis points out that retirement plan participation is strongly affected by the type of employee being measured. For instance, among all 156.5 million Americans who worked in 2012, 76 million worked for employers or unions that sponsored a pension or retirement plan, and 61.6 million participated in a plan. This translates into a sponsorship rate of 48.6% and a participation level of 39.4%, respectively.

This broad measure of the work force contains all employees, says Copeland, including self-employed, part-time employees, as well as those who typically have a looser connection to the work force such as those younger than age 21 and older than 64. When considering full-time, full-year wage and salary employees between ages 21 and 64, the analysis finds 60.4% of these employees worked for employers sponsoring a retirement plan, and 53.5% of the employees participated in a plan.

According to Copeland, the analysis confirms a long-standing gap between public- and private-sector rates, with 71.5% of public-sector employees participating in an employment-based retirement plan versus 39.1% of private-sector employees.

Other findings from the analysis include:

  • A number of criteria is associated with lower levels of retirement plan participation, including being nonwhite, younger, female, never married, having lower educational attainment, lower earnings, poorer health status, no health insurance, not working full-time, not working for the full year, working in service occupations and/or working in farming, fisheries or forestry;
  • Those working for smaller firms, private-sector firms or firms in the “other” (not professional) services industry also are less likely to participate in a plan than their comparison groups;
  • Geographic location affects the likelihood of participating in a retirement plan, with employees in the South and West less likely to participate in a plan than those in other regions of the country;
  • The overall percentage of females participating in a plan is lower than that of males. Yet, when controlling for work status or earnings, the female participation level actually surpasses that of males; and
  • Non-native-born Hispanics have substantially lower participation levels than native-born Hispanics, even when controlling for age and earnings. Black and native-born Hispanic workers have participation levels much closer to those of white workers within each age group.


The full analysis, “Employment-Based Retirement Plan Participation: Geographic Differences and Trends, 2012,” is available in the November EBRI Issue Brief, which can be found on the EBRI website.