Self-employed, concerts and other non-traditional workers find it difficult to save for retirement


Millions of Americans work in non-traditional jobs, as freelancers, sole proprietors, occasional professors, or concert workers, for example. Their economic situations tend to be as diverse as their jobs; their income levels vary from high-paying consulting jobs to low-wage hourly jobs. But many face great hurdles in saving for retirement or the prospect of not being able to retire at all.

On November 16, The Pew Charitable Trusts hosted a virtual panel to discuss ongoing research into the particular issues facing non-traditional workers as they struggle to keep their bills paid and save for their future. The ranks of these workers are growing; estimates of non-traditional workers in the US workforce vary widely, up to around 40%. To better understand the challenges they face in saving for retirement, Pew surveyed around 1,000 people working in such non-traditional jobs in mid-2020. The results served as the basis for a series of research articles.

The panel discussed fundamental questions, including the degree to which non-traditional workers have access to pension plans, the obstacles they face in saving, whether coordination with a spouse or partner can help, their balances of retirement savings and the impact of COVID-19 on non-traditional work.

Speakers included John Scott, Pew’s Project Director for Retirement Savings; Alison Shelton, senior manager for retirement savings at Pew; David John of the Brookings Institute and Senior Strategic Policy Advisor at AARP; and Cy Richardson, senior vice president of the National Urban League. Gary Mottola, Research Director of the FINRA Investor Education Foundation, acted as moderator. The Financial Sector Regulatory Authority, known as FINRA, helped sponsor the survey through its educational foundation.

The experts offered insight into the various issues facing this critical sector of the country’s workforce. For example:

  • Non-traditional workers face huge barriers to saving for retirement, primarily insufficient income to cover household expenses and emergencies. This leaves little to no money for long term savings. When asked if there was a conflict between emergency savings and retirement savings, John of AARP noted that state-sponsored programs that automatically enroll workers without options to d Workplace savings in Individual Retirement Accounts (IRAs) “have the merit of allowing participants to do both.” States should consider creating emergency savings accounts with automatic enrollment, he said. “This is where you get participation. “

    Research shows that financial insecurity is a barrier to saving for retirement, regardless of income, race or education. Richardson, of the National Urban League, stressed the importance of providing non-traditional workers with options that strengthen their decision-making capacity, calling it “the first step towards economic empowerment.”

  • Less than a quarter of non-traditional workers save through an employer-sponsored plan, mainly because they do not have access to it. Pew research also found that for odd jobs and other non-traditional workers who don’t have a work plan, accessing retirement savings through a spouse’s or partner’s plan doesn’t is often not a viable option for providing retirement security.

Experts also discussed the difficulties faced by non-traditional workers in an odd-job economy. Stage work is growing in the global economy, due to the rise of app and web platforms such as Uber, Lyft, Etsy, and Upwork. While these platforms allow more households to participate in the economy, they also significantly limit access to retirement savings opportunities similar to those offered to employees in more traditional workplaces. “How do you offer non-traditional workers what others have in terms of retirement savings? Richardson asked. He said retirement programs or plans that provide access to non-traditional workers should be a main part of the solution.

The discussion provided an overview of policy solutions, emphasizing nuanced approaches to better meet the needs of these workers. Speakers noted that:

  • Because the population of non-traditional workers is so diverse, there isn’t a single solution that can put them on the path to retirement savings.
  • To resolve the dispute over whether workers can save for emergencies as well as for retirement, state auto-IRAs have allowed workers to withdraw money without penalty if necessary, while continuing with payroll deductions in order to to rebuild their savings.
  • The biggest hurdles might be finding ways for workers to easily enroll in such programs if they are not automatically enrolled, as many more traditional jobs are now. “We need a simple way to register people,” said John of AARP.

Upcoming Pew reports will further explore survey results that show how non-traditional workers view specific policy proposals.

Download Alison Shelton’s presentation detailing the results of the Pew investigation, or watch the full video of the event below.

John Scott heads The Pew Charitable Trusts Retirement Savings Project.


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