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Do State-Sponsored Retirement Plans Boost Retirement Saving?

Author

Listed:
  • John Chalmers
  • Olivia S. Mitchell
  • Jonathan Reuter
  • Mingli Zhong

Abstract

Oregon recently launched an automatic-enrollment retirement savings program for private sector workers lacking access to other workplace retirement plans. We analyze participation choices, account balances, and inflow/outflow data using administrative records between August 2018 and April 2020. Within the small to mid-sized firms served by OregonSaves, estimated average after-tax earnings are low ($2,365 per month) and turnover rates are high (38.2 percent per year). Younger employees and employees in larger firms are less likely to opt out, but participation rates fall over time. Overall, we conclude that OregonSaves has meaningfully increased employee savings by reducing search costs.

Suggested Citation

  • John Chalmers & Olivia S. Mitchell & Jonathan Reuter & Mingli Zhong, 2022. "Do State-Sponsored Retirement Plans Boost Retirement Saving?," AEA Papers and Proceedings, American Economic Association, vol. 112, pages 142-146, May.
    • Handle: RePEc:aea:apandp:v:112:y:2022:p:142-46
    DOI: 10.1257/pandp.20221021
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    More about this item

    JEL classification:

    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth
    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
    • J32 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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