Access to Specific Provision Employer-Provided Benefits: New Estimates

[Excerpt] Many employers offer some type of health or retirement package, but their provisions vary considerably from employer to employer. Knowing the details of the types of coverage available affords a better understanding of benefits in the workplace. For example, health plans may be prepaid (health maintenance organizations, or HMOs) or fee for service (such as preferred provider organizations, or PPOs), and may or may not offer dental coverage. Defined contribution plans may be structured around company matches on employer contributions or may consist of non-elective employer contributions alone. The Bureau of Labor Statistics refers to these details as plan provisions. This Beyond the Numbers article describes the prevalence with which people working for private employers in the United States are given the opportunity to enroll in health and retirement plans with various provisions—the extent to which they have access to those provisions. But note: just because a worker has access to a given plan does not mean that he or she participates in the plan. Once given access, the worker often must affirmatively enroll in the plan in order to be counted as a participant (and to receive and enjoy the plan’s benefits laid out in its provisions). The rate at which workers enroll in plans to which they are given access is known as the takeup rate. Often, the takeup rate for a plan is less than 100 percent, perhaps because enrolling in the plan requires that the worker incur some cost or because the worker also has access to several alternative plans. As a result, the participation rate—the extent to which workers in the economy participate in plans—is often lower than the corresponding access rate. The analysis that follows explores this dynamic by presenting participation and takeup rates for plan provisions alongside the access rate

Encouraging Participation in 401(k) Plans: Reconsidering the Employer Match

This study offers new evidence on the effects of plan provisions on 401(k) participation rates, exploiting microdata from the National Compensation Survey, a large, nationally representative, establishment dataset. In particular, it closely considers the observed effects of the matching contributions made by employers to plan accounts, and makes direct comparisons between these effects and those of other plan provisions thought to affect participation: the availability of participant control over plan investment allocations; the option of drawing loans from plan accounts; and, especially, the institution of automatic enrollment in plans. The study first places these effects within a broadly sketched theoretical model in which plan participation and the match rate are jointly determined. This model puts results from the previous literature into context and helps define the “treatment effects” that different parties may find of interest. It then addresses the potential endogeneity affecting measurement of these treatment effects by employing several different techniques: adding previously unused controls; distinguishing between different dimensions of the match; and employing instrumental variables. The results of this analysis indicate that the effects of plan provisions vary dramatically between different income groups. The results among workers in the lowest income group comport with a growing consensus in the literature: employer matches have little or no effect on participation, while automatic enrollment has dramatic effects. But among workers in the middle income group, employer matches have substantial effects that may be larger than the effects of automatic enrollment.401(k), Employer Match

Workplace-Linked Pensions for an Aging Demographic

Pensions and population aging intersect in two ways. First, demographic change threatens the sustainability of traditional pay-as-you-go social security pensions, leaving workplace-linked pensions with a greater role in retirement provision. Second, as the Baby Boom generation enters retirement, new challenges arise around its retirement support. This chapter reviews some of the implications of population aging for workplace pensions in this new environment, outlines market considerations important for workplace-related pension design for the future, and discusses how governments can create an environment supportive of workplace-related pensions, should they wish to do so. We conclude that workplace-linked retirement saving systems will be asked to do even more than in the past, given the financial stress that pay-as-you-go governmentrun Social Security plans are confronting in the face of an aging demographic. This will require further product innovation and additional research

Structural changes in the United States economy and labor market outcome differences between groups.

This dissertation consists of two separate manuscripts examining the effects of structural changes in the U.S. labor market on the labor market success of workers. The first manuscript considers the effects of job movements between metropolitan subregions. Much previous work has considered the possibility that the movement of jobs out of central cities and into the expanding suburbs characterizing the last several decades has disadvantaged central-city residents in the labor market and that this advantage has fallen disproportionately (or perhaps exclusively) on minority populations. The manuscript offers new evidence on the evolution of such spatial mismatches during the 1970s and the 1980s. Using a unique data set in which metropolitan subregions are geographically matched across these decades, it directly examines the relationship between geographic variations in job growth and geographic variations in wage and employment rate growth. The primary finding is that relative job growth in a given metropolitan subregion confers a labor market advantage on the residents of that subregion, both in terms of increased nominal wage rates and increased employment probabilities. This advantage is significant for nearly all broad demographic groups, but it is highest for relatively less-educated workers and blacks. The second manuscript examines the causes of women's relative wage improvements in the U.S. during the last 3 decades. The manuscript lays out a theoretical model of the distribution of male and female workers among occupations and the relative wages paid to those occupations; it then relates this model to the distinction between demand shifts that may have benefited women and individual improvements women may have made. An empirical analysis follows that uses the insights of the model to perform a series of decompositions attributing women's gains in different time periods to different factors. It finds that women's gains are due primarily to improvements in women's characteristics in the workplace, including significant amounts of occupational upgrading. It finds no evidence that labor demand shifts favoring women contributed to women's wage gains, although such demand shifts help explain the concentration of those wage gains in the 1980s.Ph.D.GeographyLabor economicsSocial SciencesUniversity of Michigan, Horace H. Rackham School of Graduate Studieshttp://deepblue.lib.umich.edu/bitstream/2027.42/132778/2/9990884.pd