Pension Coverage 2023

Two thirds of occupational pensions are now defined contribution

• The prevalence of Defined Contribution pensions has increased in 2023 to two thirds (66%) of all occupational pensions from current employment, while Defined Benefit pensions have decreased to three in ten of pensions from workers’ current job – a decrease of two percentage points when compared with the same period in 2022. See Figure 4.1, Table 4.1 and PxStat Table PMQ32 for 2022 comparison.
• Just 4% had hybrid pension schemes (neither a full Defined Benefit scheme nor a full Defined Contribution scheme but has some of the characteristics of each).
• Rates of Defined Benefit occupational pension cover is highest for the older age groups, with 48% of females and 36% of males in the 55 to 69 years age group having a Defined Benefit occupational pension from their current employment. By comparison, of employees aged 25 to 34 years, just 25% of males and 28% of females had a Defined Benefit occupational pension from their current employment, as did just 19% of males and 29% of females in the 35 to 44 years age group. 
• Females were more likely than males to have a Defined Benefit pension scheme – 34% of females compared with 27% of males.

One in five workers with current occupational pension scheme in scheme for 20+ years

• Almost one in five (19%) stated that they had been contributing to their occupational pension scheme in their current job for twenty years or more, while almost four in ten (39%) had been in their pension scheme in their current employment for less than five years. See Table 4.2.
• One third (32%) of Defined Benefit occupational pension holders were part of their pension scheme for 20 years or more, compared with less than one in eight (13%) Defined Contribution pension schemes. Similarly, 39% of pension holders with Defined Benefit pension schemes from previous employments, are in it for twenty years or more, while just over one in five (21%) Defined Contribution schemes from previous employments are in their schemes for this duration. 
• Nearly half (48%) of older workers aged 55 to 69 are paying into their current occupational pension for 20 years or more, while 32% of occupational pension holders aged 45 to 54 years were in their pension scheme for this duration. See Table 4.3.
• Almost two thirds (65%) of 25 to 34 years with an occupational pension in current employment, have been a member of their pension scheme for 5 years or less, while nearly three in ten (28%) have been in their pension scheme between 5 and 9 years.

Over half of employees with no occupational pension say employer does not offer one

• Over half of employees (52%) without an occupational pension said that their employer did not offer a pension scheme, unchanged from when the survey was last carried out in 2022. Almost a quarter of employees (24%) had chosen not to join their employer's pension scheme. A further one in six (16%) employees without an occupational pension were not eligible to join their employer’s occupational pension scheme. See Figure 4.2 and Table 4.4.
• Of those in part-time employment who do not have occupational pension coverage from their current job, six in ten (60%) stated that their employer does not offer a pension scheme, up three percentage points on the same period in 2022, compared with 48% of their full-time equivalents.
• The most common sectors where the employer did not offer a pension scheme for employees were the Accommodation and Food Service Activities and Human Health and Social Work Activities NACE sectors – 59% and 57% respectively of workers in these sectors. See Table 4.5.
• Three in ten (30%) of these Defined Contribution schemes were for twenty years or more, compared with 46% of Defined Benefit schemes of the same duration. See Table 4.7.