The Fact
BLS reports that in 1987, 86.1% of private employers' retirement-benefit spending went to defined-benefit plans and 13.9% to defined-contribution plans. By 2022, the shares had reversed: 29.4% went to defined-benefit plans and 70.6% to defined-contribution plans.
What This Means
Employer retirement spending did not merely change names. The dominant vehicle changed from pensions promising a formula-based benefit to individual-account plans whose final value depends on contributions and investment performance.
Sources
- U.S. Bureau of Labor Statistics, “ERISA at 50: BLS tracks the evolution of retirement benefits,” Monthly Labor Review, 2024, chart 6.