Recent data from the Current Population Survey are particularly valuable because they are taken at the worker level, as opposed to the employer level, making it possible to determine differences in retirement plan participation by various worker characteristics. This Fast Fact examines how plan participation differs by race/ethnicity, as well as how those differences are affected by other socioeconomic and demographic variables such as income, age, educational status, gender, and employer size.
Figure 3 Figure 6 Gend Income er — — Th The emplo e lower levels yme Per nt cent o -based f participatio age retireme of Wn age nt persisted plan and parti Sala across ea cipatio ry W n rn orkers level o ings levels fo f males Ages r H 21 was – ispan 64 slig W ic wor htho ly high kers, er th wherea an tha s th t of e Percentage of Wage and Salary Workers Ages 21 –64 Who Participated fem rem al ainin es — g rac 54. e/ethn 3 percent icity catego vs. 5 Par 3.7 p ries’ ticip erce pated arti nt (F cipatio ig in ur an e 5) n levels Emplo . Participatio gr yew men closer n t-B was ased to hi th gh ose o Retirement est amo f Whi ng te wor both mal kers as earnin e and fema gs le White in an Employment-Based Retirement Plan, by Race/Ethnicity Diversity, Equity, and Inclusion Council in work crea ers. sed (F With igu inre 2 each g ). How ender ever , t, t he o he d rd Plan, if er of particip ferences betw by Race/E ation een Hisp th after nicitWh anic wo y and ite work A rkge, ers’ ers p 2022 was articipatio consistent f n levels an rom hig d Wh hest t ite wo o lowest: rkers’ and Employer Size (Number of Employees), 2022 parti “ other”, Blac cipation k, levels n and lastly arrowe Hispan d for n ic wor ativekers. -bornHoweve Hispanic wor r, White and kers as th “oe earnin ther” mal gs e work increa ers had sed, m slig atchin htg lyth hi e result gher levels White Black Other Hispanic White Black Other Hispanic Janu90 ary 1 % 1, 2024, #491 80% am of p on articipatio g the rem n ainin than wo g race men o /ethn f th icity e corr catego espo ries. In nding rac contrast, th e/ethnicity e parti , whcipatio ile Black n levels amon and Hispanic female g the nonn wo ative rk- er bo s h rn ad hi Hispan gher p ic wor articipatio kers p n. ersiste d below those of all the remaining workers as earnings increased, resulting in the overall 80% Hispan 70% ic worker participation levels being comparably lower. For example, among workers with earnings of $75, 000 or more, native-born Hispanic workers had a participation level of 73.2 percent, compared with 63.6 70% Retirement Plan Participation, by Race/Ethnicity percent for nonnative-born Hispanic workers. 60% 60% Introduction Figure 5 Figure 2 50% Percentage of Wage and Salary Workers Ages 21 –64 Who Percentage of Wage and Salary Workers Ages 21 –64 Who Participated 50% Participated in an Employment-Based Retirement Since the Current Population Survey (CPS) added several new variables relating to retirement accounts starting in in an Employment-Based Retirement Plan, by Race/Ethnicity 1 40% 2019 (2018 results), more accurate Plan, estima by te Race/E s of retirement p thnicity lan and parti Gend cipatio er, n 2022 have been obtainable from the CPS 40% With Hispanic Detail and Annual Earnings, 2022 2 compared with prior years. The data provided by the CPS are particularly valuable because the data are at the White Black Other Hispanic Hispanic–Native Born Hispanic–Nonnative Born 70% All White Black Other Hispanic 90% work 30 er level, 30 % % as opposed to the employer level, making it possible to determine differences in retirement plan 61.6% participation by many worker characteristics. One such characteristic that is particularly pertinent is race/ethnicity. 60.0% 80% 60% 20% This Fast Fact examines how plan participation differs by race/ethnicity, as well as how those differences are 20% 56.5% 54.3% 54.3% 53.7% affected by other socioeconomic and demographic variables like income, age, educational status, gender, and 70% 10% employer size. 48.6% 50% 10% 47.3% 60% 0% Demographic Characteristics <10 10–24 25–99 100–499 500–999 1,000+ Public Sector 0% 40% 36.8% 21–24 25–34 35.3% 35–44 45–54 55–64 50% Source: Employee Benefit Research Institute estimates of the 2023 March Current Population Survey. Participation in employment-based retirement plans increased slightly from 2018–2022, but overall levels of Source: Employee Benefit Research Institute estimates of the 2023 March Current Population Survey. 3 30% participation differed greatly by race and ethnicity (Figure 1). For instance, while the percentage of White 40% Conclusion workers participating rose from 65.9 percent in 2018 to 67.3 percent in 2022, the participation level for Black work 30 ers was % only 52.0 percent in 2018, rising to 53.6 percent in 2022. The “other” race/ethnicity category’s When ex 20% amining participation by race/ethnicity, White workers are found to have the highest levels of Figure 4 participation levels were between those of the White and Black workers, growing closer to the level of White participation, while Hispanic workers have the lowest, and this pattern holds across income, education, age, Percentage of Wage and Salary Workers Ages 21 –64 Who 20% workers over time. Finally, Hispanic workers had the lowest participation levels, going from 39.8 percent in 2018 gender, and employer size. The low levels of Hispanic participation are driven by the especially low levels of Participated in an Employment-Based Retirement Plan, 10% to 41.8 percent in 2022. participation of nonnative-born Hispanic workers. Ultimately, there are many non-racial socioeconomic and by Race/Ethnicity and Education, 2022 10% demographic factors that correlate with having more Figure or less pl 1an participation, but racial/ethnicity gaps in White Black Other Hispanic 90% 0% participation exist even wh Percent en co age ntro of lling Fu fo ll-r th Tim ese e, fac Futll or -Year s. Thus, W fu age rthand er rese Sala arch i rys n Weeded t orkers o better understand 0% Male Female 4 Ages 21 –64 Who Participated in an Employment-Based the causes of the persistently lower participation of minority workers. Less Than $20,000 $20,000–$39,999 $40,000–$74,999 $75,000 or More Source: Employee Benefit Research Institute estimates of the 2023 March Current Population Survey. 80% Retirement Plan, by Race/Ethnicity, 2018 –2022 Source: Employee Benefit Research Institute estimates of the 2023 March Current Population Survey. All White Black Hispanic Other 70% 68.9% 70% 67.9% 67.3% 66.9% Ag e — Controlling for age does not modulate the racial retirement plan participation gap, though being older is 65.9% 65.1% 60% associated with higher participation levels (Figure 3). For example, in the youngest age category 63.9% (21–24), 27.8 Endnotes 63.3% 65% percent of White workers participated in a plan, compared with 21.6 percent of Black workers and 16.1 percent of 60.5% 50% 1 Hispan ic workers. Meanwhile, at the ages with the highest retiremen 62.9% t plan participation (45–54), 68.2 percent of 59.0% The survey of a particular year gives results about the prior year, e.g., the 2019 survey gives results for 2018. 60% 61.6% 60.7% Wh Emp ite wo loyer rk Size ers particip — Emplo ated in yment a p -based lan in 2 retiremen 022, wh t p ile lan 57.8 parti perce cipation nt of in Black wo creased rk as em ers and ploy 3 er si 8.5 pe ze (nu rcent o mber o f Hisp f anic 2 40% 59.3% See Copeland, Craig, and Kyle Bedu, “Retirement Plan Participation and the Current Population Survey: The Trend From em work ploy ers did ees) i tncreas he sam ee d. , wit Whh ile n publ otic sh -sec own tor here, work nativ ers surp e-bo ass rn Hisp ing th anic wo e particip rkers particip ation levels of ated at h the work igher ers at th levels th e lar an gest 58.0% 55% the Retirement Account Questions,” EBRI Issue Brief, no. 597 (Employee Benefit Research Institute, November 30, 2023) 56.2% no pr iv nn ate ative -sec -bo torrn emplo Hispyers (F anic wo ig rk ur ers ac e 6). ro Acro ss eac ss all e h age g mplo rou ye p. r size 55.2% s, White workers were the most likely to be 55.1% for complet 30% e results from the most recent CPS data. 53.6% parti cipating in plan. While the gap in participation between White and “other” workers narrowed at the larger 50% 52.0% 3 The race/ethnicity categories are determined by the self-identified responses to the race and ethnicity questions in CPS and em Ed uca ploy tio er sizes, nal Atta Black inment and — Hisp Similarly anic wo to in rker come and participatio age, n hi con ghti er e nue du d cation to fall al attainment below the levels o was correlated f White wo wit rkh ers. Fo higher r 20% include White, non-Hispanic; Black/African American; Hispanic; and other, which consists of those races/ethnicities not example, a employment m-on based g work retire ers m at emplo ent plan p yers arti with cipatio 500 n – levels across 999 employees all ra , 68. ce0 s/ethn percent icitie of s (Fig White wo ure 4) rk . Among ers were th retire ose ment 45% defined in the three prior categories, such as Asian Americans and those who identify as multiracial. All workers indicating with plan p ou articipan t a high scho ts, compare ol diploma, d with Wh 43.8 perce ite and Black nt of Bla work ck wo ers had rkers a simi nd lar lev 44.3els of perceparti nt of Hisp cipatio ani n c work at 31.5 percent an ers. Among d 10% 44.5% that they have a Hispanic origin are only included in the Hispanic category. em 30.1 pl oy percent, ers wi respectiv th 10–24 wo ely, wh rkers, ile “ tho e parti ther” and cipatio Hisp n level f anic wo or rk Wh ers had ite wo lo rkwer particip ers was 38.9 ation perce levels nt, vs. . Wh 28.1 ite wo percent rker and 42.6% 42.6% 40% 41.8% 4 See Copeland, Craig, and Lisa Greenwald, “2021 Retirement Confidence Survey: A Closer Look at Black and Hispanic parti 18 .8 cipatio percent n fo became r Black more and Hisp disparate star anic wortin kers g , r am especti ong those vely. with The percentag a high scho e of ol Hisp diploma, b anic wo efore th rkers particip e racial ating in a 39.8% 0% Americans,” EBRI Issue Brief, no. 530 (Employee Benefit Research Institute, June 10, 2021) for some of the reasons that No High School Diploma High School Diploma Some College Bachelor's Degree Graduate/Profnl. Degree parti plan h cipatio ad the lowest share p n gap narrowed articipatin again at th g e hi in ea ghch emplo est education yer size al attainment group, excate cept amon gory og f a g emradu ployate deg ers with ree 50 . W 0–ith 999, in in this 35% there is lower participation among minority workers. gr which oup, cate White, gory Black, Black wo 2018 and “ rk oers had ther” work the lo 20ers all 19west lev had el p parti art cipatio icipatin 2020 n levels o g. ver 7020 p21 ercent, while Hispan 2022ic Source: Employee Benefit Research Institute estimates of the 2023 March Current Population Survey. parti cipatioSo n cont urce: Em in plue oyed e Be to nel fiag. t Res earch Institute estimates of the March Current Population Survey 2019–2023. ### CPS adjustment is used for each year. 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