Pension Statistics (2026)

The defined benefit pension, an employer promise of a guaranteed monthly check for life, has quietly disappeared from most of working America. Just 15% of private industry workers even have access to one, and only about 9% actively participate, according to the Bureau of Labor Statistics (see the table below).

The exception is government. Among state and local public employees, 86% have access to a pension and 74% participate. The result is a two-track retirement system: teachers, police, and firefighters still get pensions, while most private workers save on their own through a 401(k).

A defined benefit (DB) plan promises a specific payout, usually a monthly benefit based on your salary and years of service, and the employer bears the investment risk and the responsibility to fund it. A defined contribution (DC) plan like a 401(k) instead puts money in an individual account, and the eventual balance depends on contributions and market returns.

The distinction matters because it shifts risk. Under a pension, the employer must produce the promised income no matter how markets perform. Under a 401(k), the worker absorbs longevity risk and market risk. The four-decade migration from DB to DC is essentially a transfer of that risk from employers to households.

As of March 2025, 56% of all civilian workers participated in a workplace retirement plan of some kind. But the mix has flipped: among private workers, 50% participate in a DC plan and only about 9% in a DB plan (see the table below).

Public-sector numbers are almost a mirror image. State and local government DB access is 86% with 74% participating, while their DC participation is just 19%. In the private sector, the 401(k) is the default; in government, the pension still is.

The gap between the two sectors is stark. Private-sector DB access sits at 15% and participation at roughly 9%, while public-sector access is 86% and participation 74% (see the chart below). That is not a small difference, it is a different retirement world.

It also explains why pension debates so often become public-finance debates. Because pensions now concentrate in government, the political and fiscal fights over funding, contributions, and benefit levels play out at statehouses and city councils rather than corporate boardrooms.

Coverage is deeply unequal even within the private sector. Full-time workers participate at 62%, part-timers at just 23%. Among the lowest quarter of earners, only 23% are in any plan, versus 80% of the highest quarter (see the table below).

Firm size matters just as much. Only 38% of workers at firms with fewer than 50 employees participate in a plan, compared with 76% at firms of 500 or more. Small-business and low-wage workers are the least likely to have any employer retirement plan at all, DB or DC.

The retreat has been steady and dramatic. The Social Security Administration found that the share of private wage and salary workers participating in a DB plan fell from 38% in 1980 to 20% by 2008, and it has since drifted to roughly 9% (see the chart and table below). Over the same period, DC-only coverage climbed from 8% to 31%.

The plan counts tell the same story. The number of PBGC-insured DB plans peaked at 114,400 in 1985 and had collapsed to about 32,500 by 2002, with most of the losses among small plans. Today the PBGC's single-employer program covers roughly 23,000 plans.

Corporate America made the shift deliberately. Willis Towers Watson found that just 16% of Fortune 500 companies offered a DB plan to new hires in 2017, down from 59% in 1998. Traditional final-salary pensions fell from about 246 of the Fortune 500 in 1998 to roughly 25 firms, or 5%, by 2015.

The reasons cited are consistent: longer lifespans that raise benefit costs, corporate distaste for volatile and unpredictable contribution requirements, and rising PBGC insurance premiums. A 401(k) hands those risks to the employee and turns an open-ended promise into a predictable annual expense.

Many pensions that still technically exist are no longer building new benefits. Of the Fortune 500 firms that sponsored traditional DB plans in 1998, about 47% later froze or closed the plan and moved new hires into a DC-only setup, while another 43% converted to a hybrid cash-balance design, per Willis Towers Watson.

This is why the private DB take-up rate is so low: workers may nominally have access to a plan that is frozen and accruing nothing for them. A frozen pension protects benefits already earned but stops the clock, which is one reason participation figures keep sliding even where plans remain on the books.

Follow the money and the shift is obvious. Total US retirement assets reached about $47.6 trillion in the first quarter of 2026. IRAs held $18.2 trillion and defined contribution plans $13.8 trillion (including $9.9 trillion in 401(k)s), while private-sector DB plans held just $3.0 trillion (see the chart and table below).

Government DB plans remain large at about $10.0 trillion, which is again a reminder that the pension survives mainly in the public sector. The individual-account world of IRAs and 401(k)s now holds more than twice the assets of every defined benefit plan combined.

State and local pensions have clawed back ground. The Equable Institute estimates the aggregate funded ratio rose to about 82.5% in 2025, up from 78.0% in 2024 and 75.5% in 2023, helped by a strong 9.5% average investment return in 2025 (see the table below).

Even so, 2025 marks the 18th consecutive year with an average funded ratio below the 90% threshold that Equable treats as resilient. Plans still assume an average 6.87% return, and a single recession could push the shortfall sharply higher, so the improvement is real but not durable.

Public pensions are enormous. The Census Bureau's 2024 Annual Survey of Public Pensions reported $5.99 trillion in assets across state and local systems, up 9.24% from $5.48 trillion in 2023, covering more than 36 million active and inactive members.

The cash flows are huge too. Governments and employees contributed $305.79 billion in 2024 (governments paid 75.8% of that), while systems paid out $405.45 billion in benefits, up 9.26% from the prior year. Benefit payments now exceed contributions, so investment returns must cover the gap.

The headline worry is the gap between what plans owe and what they hold. Equable pegs aggregate unfunded liabilities at roughly $1.27 trillion for 2025, down from $1.54 trillion in 2024 but still stubbornly above $1 trillion, where it has sat since the 2008 financial crisis. Employer contributions now average 31.65% of payroll, the third straight year above 30%.

The pain is concentrated. Equable identifies Illinois, New Jersey, Connecticut, and Kentucky as home to the worst-funded plans. Even CalPERS, the largest US public fund at about $563 billion, was only around 75% funded in 2024, below the national average, before a strong 2025 lifted it toward 79%.

For today's retirees, pensions still matter, though less than they once did. About one in three older adults receives some pension income, and 56% of retirees report income from a pension, according to the Pension Rights Center (see the table below).

The amounts reveal the public-private divide again. The median private pension paid $11,440 a year to individuals age 65 and older, while the median state or local government pension paid $24,930, more than double. As younger cohorts retire with 401(k)s instead, the share drawing a traditional pension will keep falling.

If you work in the private sector, the odds are you will never get a pension, which means your retirement security rests on what you save and invest yourself. A 401(k) or IRA hands you the market risk and the longevity risk that an employer used to carry, so the burden of turning savings into lifelong income is now yours.

The practical response is to treat your own accounts like a pension you are self-funding: contribute consistently, capture any employer match, keep costs low, and stay invested for the long run so growth compounds. Building a clear, thesis-driven portfolio, and rebalancing it over time, is how you replace the guaranteed check that most workers no longer receive.