A new study finds that as of 2023, 47% of U.S. workers over the age of 18 lacked access to a workplace retirement savings plan. That equates to 59 million of the estimated 125.6 million part-time and full-time private sector workers over the age of 18 not having access, while 53%, or 66.6 million workers, are estimated to have access to workplace retirement savings plans or programs.
And 23.4 million gig workers with non-traditional employment arrangements also lack access to a workplace retirement plan, bumping the total estimate of those lacking access to 82.4 million.
This all according to a new report from the Georgetown University Center for Retirement Initiatives’ Angela M. Antonelli Research Professor and Executive Director, titled, “Who Lacks Access to Retirement Savings? A State-Level Analysis and an Examination of the Potential Benefits of State-Facilitated Retirement Savings Programs.”
Not surprisingly, the report notes that levels of access to retirement savings vary by employer type, with the smallest firms being the least likely to offer access to coverage for their workforces. Nationally, 63% of private sector workers at small firms (defined as those with fewer than 50 employees) are estimated to lack access through their workplaces, compared to 34% at larger firms (defined as those with 50 or more employees).
The report finds state-facilitated retirement savings programs are having a positive impact on retirement readiness, complementing the progress being made by employer-sponsored retirement plans. The study provides analyses of initial results in increasing access and savings from three “early adopter” states—California, Illinois, and Oregon— both directly through state-facilitated programs and indirectly by encouraging private retirement plan adoption. It goes on to say that all three of those states have seen “meaningful program participation and increased private sector plan formation, which is beginning to help close the access gap in those states.”
Auto-IRA programs in Oregon, California, and Illinois (as well as many recent-adopter states) require employers in those states to participate in the state-facilitated program or offer their own employer-sponsored retirement plan. Research shows that in addition to access gains through the Auto-IRA program, each of the three early-adopter states has seen an increase in private plan formation in response to this requirement.
The report also offers a rundown on who lacks access to a retirement plan in every state.
More from the study
• Elderly population growing much faster than under-65 population: Nationally, the elderly population is anticipated to increase from 56 million as of 2020 to 75 million by 2040—an increase of 19 million. The projected growth rate for the elderly population is 34%, compared to a growth rate of just 4% in the under-65 population.
• Social Security substantially supports nearly 1 in 4 elderly households: Nationally, 23% of elderly households report deriving at least 90% of their family income from Social Security (based on data from 2022–2024). The average monthly benefit level for those receiving Social Security benefits is $1,929, or an average of $23,150 per year.
• Saver’s Match potential: The new federal Saver’s Match provides additional support for eligible low- and moderate-income workers, including those saving through these state programs. The report said it has the potential to boost retirement savings and income for millions of Americans and help supplement Social Security benefits. Introduced in SECURE 2.0 legislation, the Saver’s Match provides eligible savers with a 50% match on the first $2,000 of qualified retirement contributions starting in 2027, with a maximum match of $1,000 per individual for each tax year.
Read the full report, “Who Lacks Access to Retirement Savings? A State-Level Analysis and an Examination of the Potential Benefits of State-Facilitated Retirement Savings Programs,” at this link.
SEE ALSO:
• Saver’s Match Could Solve the Retirement Savings Gap: Morningstar