MarketWatch Features WORC’S CEO, Ellen G. Frank-Miller, PHD On The Reality Of The U.S. Retirement Landscape

“It doesn’t have to be this way. It’s the result of intentional policy choices, both public policy and employer policies. Who is getting hurt the most? It’s lower-level workers in lower-level jobs who are mostly women and people of color and that’s not the society we want to live in.”

— Ellen G. Frank-Miller, PhD

That’s what WORC’s Founder and CEO, Ellen G. Frank-Miller, PhD, had to say when she was featured in MarketWatch on January 26, 2023. The article, by Leslie Albrecht, detailed the unfortunate reality of today’s retirement landscape in the United States – some Americans who work for low wages have resorted to creating GoFundMe pages to fundraise for their retirement.

Quality jobs require quality wealth-building opportunities – for all employees, not just for high-earners.

Not all retirement plans are created equal. Employers have choices about how to design their 401(k) plans – and some designs, specifically employer matching contributions, cement inequity into the company culture.

What could possibly be bad about offering matching contributions? Nothing – for employees who are, 1) eligible for the plan and, 2) can afford to contribute. Those employees disproportionately benefit from this plan design.

Many lower-level workers, in particular part-time workers, aren’t even eligible for company-sponsored retirement plans – and when they are, they’re less likely to be able to afford to contribute than their higher-paid colleagues.

So, let’s be clear – a 401(k) matching design disadvantages lower-level workers, who are more likely to be Black and Brown. That’s called inequity.

Employers who are serious about racial equity should consider swapping their match for a safe harbor employer contribution, a 401(k) design that enables employers to make contributions for all employees, regardless of whether they contribute their own dollars. This approach addresses systemic inequities in wealth-building and can provide better retirement security than a GoFundMe campaign.

Check out the MarketWatch article here.

All budgets are moral documents – they reflect our values and priorities. What does your employee benefits budget say about your company’s racial equity values and priorities? Small-but-mighty WORC is determined to put our money where our mouth is – we offer a safe harbor employer contribution in our brand-new, decarbonized 401(k) plan. If we can do it, other companies can do it, too. Read about it here.