NCPA - National Center for Policy Analysis

Workers Surpass Employers in Pension-Plan Contributions

April 5, 2002

For decades, employers have shouldered the burden of financing retirement plans for their workers. But an analysis of the most recent data available shows that workers have taken the lead in socking away pension savings, taking advantage of 401(k)s and similar retirement accounts.

  • Companies were still the primary contributors to retirement programs of all types in 1998 -- but experts say that in 1999 or 2000 contributions of workers surpassed company payments.
  • In 1998, company-sponsored retirement accounts had assets of $4 trillion -- about half in traditional defined-benefit plans, and the other $2 trillion in defined-contribution plans such as 401(k)s, profit-sharing and stock bonus plans.
  • About 40 million employees are enrolled in defined-benefit plans, while 55 million are in defined-contribution plans -- with about 17 percent of American workers enrolled in both types.
  • Less than two-thirds of all working Americans are employed by a company that sponsors a retirement plan -- and only 52 percent of all employees participate in pension or retirement plans.

Excluding government employees, the numbers are lower. Only 47 percent of employees have anything other than Social Security awaiting them at retirement.

Source: Edward Wyatt, "Pension Change Puts the Burden on the Worker," New York Times, April 5, 2002.

For NY Times text


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