Long gone are the days of comfortable retirements. Globalization, free trade, and automation have all contributed to tight corporate profit margins, which in turn has led to diminished benefits and the disappearance of defined pension plans. In the place of pensions, many corporations offer 401K plans that come with extra burdens for employees about the retirement plans of yesteryear.
401K plans pass much of responsibility for retirement savings on to employees, along with the expenses associated with managing the money before it’s withdrawn. Also, many companies have instituted a multi-year vesting program for the employer match contribution to 401Ks, if they contribute anything at all. The net result being that employees get less for retirement than in previous generations.
Corporations are looking for as many ways as possible to squeeze the working class in America and other parts of the world, to save money and pump up profit margins. This behavior has changed the quality of life for countless people all around the world. While corporate leaders have a duty to shareholders to maximize shareholder wealth, many companies are doing so to the detriment of their employees.
It is hard to know where this trend will go and how it will end. Defined pension plans will continue to be much like an endangered species, in the foreseeable future.