I'm honored to join experts from business, labor, and academia on Philadelphia’s Task Force on Retirement Security for Private Sector Employees. Chaired by Councilwoman Cherelle Parker, the 16-person group is charged with issuing a report to the Council recommending policy solutions to address the city’s retirement crisis.
In 2016, SCEPA produced a report for the City Council at the request of Councilwoman Parker describing the retirement crisis in Philadelphia. It found that only 47% of Philadelphia’s workforce has access to a retirement plan at work, compared with 53% of workers nationally. Philadelphia’s seniors are more likely to be poor or near poor, with 50% having incomes below 200% of the poverty line, compared with 31% nationally.
Philadelphia is the latest in a series of cities and states to recognize and confront the retirement crisis. I sit on a similar commission for New York State and has been asked to advise on plans in some of the 29 states that have proposed or implemented retirement reform in the past five years.
Philadelphia is not waiting for the federal government to act on the upcoming retirement crises. At SCEPA, we have found the average 401(k) and IRA balance for older workers is $14,500 and half the workforce does not have access to a retirement plan at work. Middle class retirees risk working into their 70s or living an impoverished retirement. We hope to help all Philadelphia workers retire by contributing to a professionally managed, low fee retirement account that pays a pension for life.
In the absence of federal action, cities and states have taken the lead in proposing solutions to the retirement crisis. But to provide everyone a viable path out of the retirement crisis requires a national solution. I propose Guaranteed Retirement Accounts -- mandatory, universal savings accounts with a guaranteed rate of return -- as the best way to ensure that everyone can retire with dignity.