State-run retirement savings programs may be driving the creation of new private sector plans, according to a Pew Charitable Trust study released on Friday.
Companies in California, Illinois and Oregon – the first three states to launch state-led programs to help unplanned private sector workers save for retirement – are among the first to launch such programs. continued to launch new plans in 2021 at a rate similar to or exceeding that of states without. , a study found.
For example, in California, after launching the CalSavers program in 2019, the adoption rate of new plans as a share of existing plans rose from 8.1% prior to launch to an average of 9.4%.
Illinois and Oregon saw similar increases after introducing the Illinois Secure Choice and OregonSaves programs in 2018 and 2017, respectively. In Illinois, the average share of new plans increased from 5.3% to 6.2%, while in Oregon the share of new plans jumped from 6.7% to 8.5%.
The findings allay industry concerns that state plans could crowd out the private market for plans, researchers said in a report.
“Changes in the proportion of new plans before and after state program implementation have been consistent with national trends and, in some cases, have proven to be greater than national changes,” the authors said. says.
The study is based on data from Form 5500s and Forms 5500-SF from 2013 to 2021, or short forms, typically for plans with fewer than 100 participants.