Share of Workers with Employer-sponsored Retirement Plan, by Gender, 1979-2010
The portion of the workforce with a plan has zigzagged over the last three decades. Retirement coverage fell sharply through most of the 1980s as employers dropped traditional pensions. Coverage then increased through the 1990s, as employers began to offer lower-cost defined-contribution plans instead of traditional pensions.The economic downturn in the early 2000s, which was accompanied by a steep decline in stock prices, however, seems to have set off a second wave of declines in retirement-plan participation.By 2010, the share of workers participating in a retirement plan at work was 7 percentage points lower than it had been in 1979.An interesting additional development is that – since the early 2000s – women have been more likely than men to participate in a retirement plan, a substantial reversal of the pattern in the 1980s and 1990s. CEPR

Even as the stock market sets records and the economy shows signs of revival, American workers and employers are heading for a retirement crisis, a study being released Tuesday warns.

Financial and demographic forces are combining to squeeze individuals and companies that are trying to save for the future and make their money last, according to the Employee Benefit Research Institute.

Fifty-seven percent of U.S. workers surveyed reported less than $25,000 in total household savings and investments aside from their homes, EBRI reports. Only 49 percent reported having so little money saved in 2008.

Furthermore, 28 percent of Americans have no confidence they will have enough money to retire comfortably -- the highest figure in the study's 23-year history. Still, a majority express some level of confidence (13 percent are very confident and 38 percent are somewhat confident).

EBRI observes, “One reason that retirement confidence has remained low despite a brightening economic outlook may be that some workers may be waking up to a realization of just how much they may need to save. Asked how much they believe they will need to save to achieve a financially secure retirement, a striking number of workers cite large savings targets: 20 percent say they need to save between 20 and 29 percent of their income and nearly one-quarter (23 percent) indicate they need to save 30 percent or more.”

But “only 46 percent report they and/or their spouse have tried to calculate how much money they will need to have saved by the time they retire so that they can live comfortably in retirement,” the report finds.

And many are not putting funds aside for retirement because they’re having enough trouble meeting daily needs. As the EBRI report puts it: “Retirement savings may be taking a back seat to more immediate financial concerns. … Cost of living and day-to-day expenses head the list of reasons why workers do not contribute (or contribute more) to their employer’s plan.”

The EBRI survey doesn't count traditional pensions, which are designed to provide retirees for steady income throughout their lives. But the portion of private-sector U.S. workers covered only by so-called defined-benefit plans fell to 3 percent in 2011 from 28 percent in 1979, according to U.S. Department of Labor data compiled by EBRI.

Corporations are subject to the same forces. The Society of Actuaries reported recently that rising life expectancies could add as much as $97 billion to corporate pension liabilities in coming years, an increase of up to 5 percent, according to The Wall Street Journal.

While Americans are living longer, the extended life spans will make it tougher for workers trying to stretch retirement savings and put additional strains on pension plans.