Hispanic workers lag far behind other workers in retirement plan participation. In 2012, just 34 percent of prime-working-age Hispanic workers employed 35 or more hours per week were enrolled in an employer-based plan, compared with 59 percent of their non-Hispanic white counterparts. (The focus is on 2012 because apparent declines in 2013-15 are likely due to problems stemming from changes in the survey.)
Some workers opt out of 401(k)s and other voluntary plans, especially if they receive little or no employer match or tax subsidy. A much more prevalent problem is working for an employer that does not offer a plan in the first place, as 59 percent of Hispanic workers do. Even if the take-up rate for Hispanic workers were the same as for non-Hispanic white workers, 89 percent of the gap between the two groups would remain.
The lack of access to traditional pensions and 401(k)s makes it hard for Hispanics to prepare for retirement and increases their reliance on Social Security and working in old age. Only a quarter of prime-working-age Hispanic families have retirement account savings and the median balance is just $22,000. A new retirement plan in California, where a quarter of Hispanics live, could make a difference. The new California Secure Choice plan will make it easier for workers without employer-based plans to save. Expanding Social Security would make an even bigger difference to Hispanics, who have longer-than-average lifespans.
Hispanic workers are much less likely to participate in retirement plans: Retirement plan participation for workers age 32–61 who work 35 or more hours per week and 50 or more weeks per year, by race and ethnicity, 1980–2016
| White | Black | Asian and other | Hispanic | White (post 2012) | Black (post 2012) | Asian and other (post 2012) | Hispanic (post 2012) | |
|---|---|---|---|---|---|---|---|---|
| 1979 | 62.0% | 57.5% | 53.3% | 49.1% | ||||
| 1980 | 61.3% | 57.3% | 48.6% | 50.2% | ||||
| 1981 | 61.3% | 59.2% | 53.9% | 48.1% | ||||
| 1982 | 60.3% | 60.5% | 53.4% | 48.4% | ||||
| 1983 | 59.8% | 60.5% | 51.2% | 48.8% | ||||
| 1984 | 58.9% | 60.2% | 52.4% | 47.1% | ||||
| 1985 | 59.7% | 64.6% | 54.0% | 46.2% | ||||
| 1986 | 58.9% | 62.0% | 53.5% | 45.0% | ||||
| 1987 | 56.1% | 59.5% | 52.6% | 42.5% | ||||
| 1988 | 56.4% | 59.5% | 50.6% | 40.7% | ||||
| 1989 | 57.2% | 60.8% | 50.2% | 41.4% | ||||
| 1990 | 57.7% | 58.6% | 47.0% | 42.0% | ||||
| 1991 | 58.2% | 59.8% | 46.2% | 41.4% | ||||
| 1992 | 58.6% | 57.8% | 48.9% | 40.1% | ||||
| 1993 | 61.8% | 57.7% | 53.2% | 41.3% | ||||
| 1994 | 64.0% | 63.1% | 55.1% | 42.3% | ||||
| 1995 | 63.5% | 63.3% | 51.8% | 40.9% | ||||
| 1996 | 64.2% | 61.0% | 53.3% | 44.5% | ||||
| 1997 | 63.9% | 60.6% | 52.7% | 40.8% | ||||
| 1998 | 65.4% | 60.9% | 56.3% | 43.2% | ||||
| 1999 | 64.1% | 60.0% | 53.9% | 41.4% | ||||
| 2000 | 64.2% | 56.6% | 51.0% | 40.3% | ||||
| 2001 | 62.7% | 57.8% | 52.2% | 39.0% | ||||
| 2002 | 61.2% | 56.0% | 50.9% | 37.6% | ||||
| 2003 | 61.7% | 57.3% | 52.4% | 38.5% | ||||
| 2004 | 60.8% | 56.1% | 53.5% | 36.0% | ||||
| 2005 | 60.1% | 54.4% | 50.9% | 35.4% | ||||
| 2006 | 57.6% | 50.8% | 48.9% | 33.0% | ||||
| 2007 | 60.8% | 53.6% | 52.2% | 35.3% | ||||
| 2008 | 59.9% | 53.5% | 50.5% | 35.5% | ||||
| 2009 | 58.7% | 53.4% | 50.2% | 36.9% | ||||
| 2010 | 58.7% | 54.9% | 51.2% | 36.9% | ||||
| 2011 | 58.9% | 54.6% | 50.6% | 35.2% | ||||
| 2012 | 58.8% | 52.6% | 51.2% | 34.5% | 58.8% | 52.6% | 51.2% | 34.5% |
| 2013 | 56.5% | 52.2% | 49.3% | 35.1% | ||||
| 2014 | 50.7% | 46.9% | 44.0% | 31.0% | ||||
| 2015 | 47.1% | 44.0% | 41.4% | 31.0% |
White denotes Non-Hispanic White, Black denotes Non-Hispanic Black, and Hispanic includes Hispanic of any race. Dotted lines represent a change in the survey.
Source: EPI analysis of Current Population Survey data (IPUMS-CPS, University of Minnesota)
