Workforce Issues & Employee Benefits

American workers lack pension security, beyond Social Security, because individual commercial retirement accounts are tied to the volatility of finance markets, are inadequately funded, have poor net-of-fees returns, and do not pay a guaranteed rate of return for the rest of a retiree’s life. Also, employers have conflict of interests between their needs and their workers' needs when choosing 401(k) investment vehicles. Pension coverage is stuck at half of the workforce

Only half of American workers have a pension plan, and only a fraction of those have traditional pensions that replace a meaningful part of their final pay. Instead, most workers with a pension today have a 401(k) plan or an individual retirement account, and according to a recent report by the U.S. Government Accountability Office, only a fraction of those workers will save enough to get a meaningful monthly benefit.

This month the oldest baby boomers started turning 62, and millions more will follow in the coming decades. Before it is too late, we need to adopt policies to ensure that every worker has adequate retirement savings.