Nearly half of Maryland’s workers are not participating in employer-sponsored retirement programs, putting the future stability of the state’s economy at risk, according to a study from the Schwartz Center for Economic Policy Analysis (SCEPA).
Released on April 2, the study details a downward trend in the number of Maryland workers contributing to employer-sponsored retirement programs from 1995-2012.
The data also shows that four in 10 households headed by people nearing retirement (ages 55-64) will have to survive on Social Security, or may not be able to retire at all.
Overall, in the decade from 2000-2010, the percentage of employers offering sponsored retirement programs dropped eight percent, from 67 percent in 2000 to 59 percent in 2012.
Workers between the ages of 25-44 saw an even larger drop off, with 13 percent fewer employers offering sponsored retirement programs, leading SCEPA to project that the downward trend will continue as the population ages. Hispanic workers have experienced the most significant effect, with a 20 percent decline in sponsored programs, more than twice the nine percent reduction seen by white and black/non-Hispanic workers.
Even those employees who have the option to contribute to employer-sponsored plans are not doing so at optimal rates. The study found that of the 59 percent of workers who have the opportunity to participate, 14 percent do not.
The report does offer an option for Maryland workers--legislation introduced by Maryland Del. Tom Hucker (D-Montgomery County), which would allow workers to open a Guaranteed Retirement Account (GRA) through the Maryland State Retirement and Pension System.