Pensions vital to solve brewing retirement crisis, says think tank

Immediate fixes to crumbling workplace pension and Social Security systems required, report says.

As the financial challenges confronting American workers snowball into a full-blown retirement crisis, the National Institute on Retirement Security has joined the growing chorus calling for action.

According to a new NIRS report, Retirement Insecurity 2024: Americans’ Views of Retirement, which draws from a survey conducted by Greenwald Research, 83 percent of Americans believe that all workers should have access to a pension plan, viewing it as a critical component of a secure retirement.

Echoing that finding, four-fifths (79 percent) of respondents agreed there’s a retirement crisis in the U.S. – an increase from two-thirds (67 percent) in 2020. A little more than three-quarters of workers today (77 percent) also agreed the American dream of retirement has gotten harder to reach following the steady disappearance of pensions.

“A financially secure retirement is out of reach for many Americans, and our research finds workers are increasingly troubled by their retirement outlook,” said Dan Doonan, NIRS executive director and co-author of the report.

With 55 percent of Americans feeling doubtful over their ability to achieve financial security in retirement, Doonan called on leaders to increase pension coverage for US. workers. As some employers like IBM reinstitute pension plans for their workforce, he suggested others follow suit as a way to provide retirement benefits cost-efficiently as well as to compete in an increasingly tight race for talent.

The survey also found a strong majority (87 percent) in favor of Congress immediately addressing the funding challenges for the country’s Social Security system, rather than waiting 10 years to come up with a solution.

“Americans don’t want Congress to kick the can down the road when it comes to ensuring the long-term sustainability of Social Security. Americans want action now,” Doonan said.

The survey uncovered a broad spectrum of trepidation among workers, with 87 percent being generally concerned about rising costs. Nearly the same portion (86 percent) shared worries about health care costs in retirement, while others felt anxious over increasing long-term nursing expenses (80 percent), housing costs (75 percent), and costs of getting help for everyday chores (66 percent)

With that in mind, 87 percent of respondents maintained that no matter the state of the country in terms of budget deficits, the government must keep Social Security high on its priority list.

“Social Security is a highly successful government program that is both popular and essential for millions of older Americans,” Doonan said. “Delaying decisions on funding only creates more financial anxiety for Americans and makes an eventual solution more expensive.”