Pension Participation and Uncovered Workers

The Obama Administration has proposed "Autho-IRAs" to boost pension coverage among those not currently offered a plan. Such a policy is seen to offer great potential, given that 60% of low-income workers currently offered a 401(k) choose to participate. However, these low-income workers with 401(k)s are different from their counterparts at firms that do not offer 401(k)s. Taking this difference into account, take-up among low-income workers could be as low as one third.