Even as lots of people these days are thinking, “Retirement? What's that?” others are lucky enough to belong to a retirement plan of some sort. But retirement is a luxury not offered to just anyone; all over the country, retirement plan participation is on a downturn, along with the economy.
In fact, according to figures compiled by the Employee Benefit Research Institute (EBRI), and released Tuesday, fewer than half the 156.2 million workers in the U.S. were even offered the opportunity, whether by a private employer or public entity.
According to the October EBRI brief “Employment-Based Retirement Plan Participation: Geographic Differences and Trends, 2010,” approximately 40% of all workers took the opportunity when offered. While different demographic groups participate at different rates—much lower among both Hispanics and those without a high school diploma, for instance—that still means that, of 75 million given the chance, 60.7 million seized the brass ring.
The study not only looked at 2010’s overall figures, but calculated a three-year moving average trend for 2001-2010. The three-year average looked at wage and salary for workers ages 21-64 and the percentage of that specific group able to participate in an employer-sponsored retirement plan.
The ultimate irony, perhaps, is that many covered by a retirement plan work in states where they might not choose to retire. Here are the top 10 states where the most employees participate in a retirement plan at work.
(3-Year Moving Avg.: 51.5%)
Overall, 44% of working Virginians have a retirement plan of some sort. But Virginia has lost some ground in the three-year moving average, falling from 2001’s 55.8% to 2010’s 51.5%. Yet within the consolidated area of Washington, D.C., Baltimore, and northern Virginia, the participation of public sector employees ages 21-64 in a retirement plan is pretty hefty: 79.3% of those offered the option take it.
So if you plan to enjoy all the delights of retired life in Virginia, you might want to look for work in the public sector.
(3-Year Moving Avg.: 50%)
Oh, who cares what the numbers are? Surely you can figure out a way to stay in Hawaii if you managed to work there in the first place! Sun, sand, surf, hula dancing and luaus, slack-key guitar ... need we say more?
(Actually, Hawaii hasn’t lost as much retirement ground as the mainland; 2001’s percentage was 52.3%, and 2010’s was 50%. Extra reason to stick around.)
(3-Year Moving Avg.: 49.2%)
Retirement plan participation is falling in Delaware, too, despite—or perhaps because of—its business-friendly nature. More than 50% of U.S. publicly traded corporations and 60% of Fortune 500 companies are incorporated in Delaware.
The overall average for 2010 was 44.7%, but that three-year moving average of retirement plan participation dropped from 57% in 2001 to 49.2% in 2010. Of course, there are plenty of coastal attractions, so you could have a second career as a beachcomber.
(3-Year Moving Avg.: 49.1%)
It should come as no surprise that here, too, despite an overall rate of 44.9%, the trend is down on retirement plan participation, falling from a 2001 three-year average of 56.5% to a 2010 three-year average of 49.1%.
At this rate, don’t plan on betting on the Preakness with those retirement dollars, or you might find yourself currying the horses at Pimlico instead of currying favor with the owners in the stands.
(3-Year Moving Avg.: 53.2%)
Minnesota's three-year trend for participants is on the downward slope, along with its overall number of 45.1%. In 2001, Minnesota stood at 59.2%; by 2010 it had fallen to 53.2%.
If the trend continues, retirees would be better advised to stay out of the Mall of America and reread the Little House on the Prairie books to their grandkids—or recapture their youth by putting on their old Bob Dylan records (Records? What are records?)….
(3-Year Moving Avg.: 50.9%)
Overall, the Keystone State rang in with 45.3%. The three-year moving average in Pennsylvania, though, was 50.9% in 2010, compared with 57.5% in 2001. Not good news. However, Pennsylvania's public sector workers are the luckiest in the state, with regard to participation in a retirement plan. The state had the highest level of participation, at 78.9%. Smart folks—planning ahead! And there are so many things to do in the state, from winter sports to camping to gambling and music festivals, that those savvy enough to retire there can be very busy indeed.
(3-Year Moving Avg.: 52.5%)
The three-year moving average for Wisconsin 2001 stood at 60.1%. Although there were a couple of years in the middle of the decade when it bumped back up for a bit, the trend has been, again, steadily declining, and the three-year average now stands at 52.5% for that particular group.
You'll note that the overall number of all employees participating, not just that particular group, is somewhat lower, coming in at 45.6%.
Of course, you could always learn to make and sell artisanal cheeses to support yourself in those golden years.
(3-Year Moving Avg.: 52.2%)
Kansas actually saw an increase in participation in retirement plans from 2009 to 2010. That’s handy for those who want to stick around to enjoy the state’s reputation as the 9th or 10th sunniest state in the country, depending on the source of your information. Aside from that bit of good news, the overall rate was 46%, while the three-year moving average came in at 52.2% in 2010, which, alas, is down from 2001’s 53.9%.
Of course, Kansas is also known for its tornadoes when it’s not being sunny, so you could always launch a second career as a storm chaser—or a Wizard, in an entirely new location.
(3-Year Moving Avg.: 52.1%)
You have to be fond of cold weather—very cold—to enjoy Alaska’s winters, but if that’s the case, you’ll find plenty of outdoor activities to attract those retirement hours. Fishing, hunting, and tourism in general provide the opportunity to enjoy the state’s natural beauty. And you’re in luck—participation in retirement plans actually increased here, too, from 2009 to 2010. Still, the overall rate for 2010 was 46.5%, while the three-year moving average was down only slightly, at 52.1% in 2010, from 52.6% in 2001.
Industry is dominated by petroleum, but gold and precious metals are also important to the state’s economy. Maybe a second career as a prospector?
(3-Year Moving Avg.: 51.7%)
Workers in West Virginia who decide to take advantage of those retirement plans will find plenty to do in their home state once they’ve left the workforce, particularly if they’re into outdoor activities such as hiking and spelunking. Caves are plentiful, as are fossils and coal—that last plays such a prominent role in the state’s economy that it is the official state rock.
West Virginians are lucky in other respects, too: they had the highest probability among all Americans to participate in retirement plans in 2010, at 54.2%. Not only that, but while the overall rate for 2010 was 49.2%, the three-year moving average was 51.7% in 2010—up from 49.2% in 2001.
Top 10 lists from AdvisorOne: