EBRI Notes

Another Year After the Current Population Survey Redesign and More Questions About the Survey’s Retirement Plan Participation Estimates

Nov 21, 2016 16  pages


  • The Annual Social and Economic Supplement (fielded in March of each year) to the Current Population Survey (CPS), conducted by the U.S. Census Bureau, is one of the most-cited sources of income data for those whose ages are associated with being retired (typically ages 65 or older). It has also been used to provide annual estimates of employment-based retirement plan participation.
  • The Census Bureau conducted a redesign of the CPS questionnaire in 2014 on the income questions that resulted in much lower estimates of the percentages of workers who participate in an employment-based retirement plan.
    • For example, the percentage of full-time, full-year wage and salary workers ages 21?64 participating in an employment-based retirement plan was more than 11 percentage points lower in 2015 after the redesign relative to the 2013 estimate under the traditional questionnaire design. This translates into more than 9 million fewer individuals participating in an employment-based retirement plan.
    • The groups of workers most affected were those with the highest likelihoods of participation—older, higher earners, and employees of larger employers.
  • Unless modifications are made to the CPS, using the CPS for estimating the participation in pension and other retirement plans will provide misleading and inaccurate estimates and conclusions.
  • The support for this assessment includes the much lower level of participation found under the redesigned questionnaire estimates relative to the traditional questionnaire estimates in 2013, the considerable decline in the estimated number of retirement plan participants after the redesign of the CPS questionnaire, and the inconsistent time series in the participation levels in CPS relative to other federal government surveys (i.e., National Compensation Survey).
  • Rather modest modifications could be made within the CPS questionnaire to improve the retirement plan participation estimates. Until that time, any person or organization using the data or those reading analyses from the data need to be aware of the issues with the CPS data on pension and retirement plan participation. The estimates from the most recent surveys could easily be misconstrued as an erosion in coverage, as opposed to an issue with the data.