errata

The headline and the first paragraph incorrectly stated that 74 percent of private industry workers participate in a savings and thrift plans. The text was corrected to show that 44 percent of private industry workers participate in any kind of defined contribution plan. Of those participants, 74 percent were in a savings and thrift plan.

74 percent of defined contribution plan participants had savings and thrift plans in 2015

December 30, 2016

In 2016, 44 percent of workers in private industry participated in defined contribution retirement plans. Defined contribution retirement plans accumulate tax-deferred savings in individual employee accounts established by the employer. In 2015, 74 percent of workers who participated in a defined contribution plan were in a savings and thrift plan, more than any other type of plan. A savings and thrift plan requires an employee to contribute a portion of earnings into an individual account; the employer may match the contribution. Nineteen percent of workers who participated in a defined contribution plan were in deferred profit sharing plans and 16 percent participated in money purchase plans. In deferred profit-sharing plans, employers usually contribute money to employee accounts based on company profits. A money purchase pension plan provides fixed employer contributions, typically calculated as a percentage of employee earnings.

Participation in defined contribution plans by type of plan, private industry workers, 2015
Worker type Savings and thrift Deferred profit sharing Money purchase pension Employee stock ownership (ESOP) Savings incentive match plan (SIMPLE)

All workers

74 19 16 4 3

Management, professional, and related

73 19 20 4 2

Service

79 13 13 - -

Sales and office

79 18 11 6 3

Natural resources, construction, and maintenance

59 18 19 - -

Production, transportation, and material moving

75 20 15 - -

Note: The sum of participation rates across each plan may be greater than 100 percent because multiple plans are available to some employees. Dash indicates the percentage rounds to zero.

In 2015, worker participation was lowest in employee stock ownership plans (4 percent) and savings incentive match plans (3 percent) among defined contribution plans. In an employee stock ownership plan, the employer pays into a fund that is typically invested in company-related stock. A savings incentive match plan is designed to help small businesses set up individual accounts for their employees; these accounts can be part of a 401(k) plan or an individual retirement account (IRA).

Fifty-nine percent of natural resources, construction, and maintenance workers with a defined contribution plan participated in savings and thrift plans. Less than 1 percent of service; natural resources, construction, and maintenance; and production, transportation, and material moving workers participated in employee stock ownership plans or savings incentive match plans.

These data are from the National Compensation Survey. To learn more, see the Beyond The Numbers article “Defined contribution retirement plans: Who has them and what do they cost?

SUGGESTED CITATION

Bureau of Labor Statistics, U.S. Department of Labor, The Economics Daily, 74 percent of defined contribution plan participants had savings and thrift plans in 2015 on the Internet at https://www.bls.gov/opub/ted/2016/74-percent-of-private-industry-workers-participated-in-saving-and-thrift-plans-in-2015.htm (visited December 12, 2017).

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