The movement to require employers to offer retirement plans to their workers just took a big leap forward.
California Governor Jerry Brown signed legislation last week launching the state’s Secure Choice plan – a government-sponsored retirement savings vehicle that would be offered to employees of most companies that do not have their own workplace retirement plan.
California is the seventh state to enact a plan, and it will be the largest by far in the nation. The green light marks a major expansion of government-sponsored retirement plan coverage in the United States – the plan is expected to cover 1.6 million workers in the first year alone; ultimately, 6.8 million will be eligible.
The states taking action are alarmed at the prospect of large numbers of their citizens headed toward retirement with little or no savings – in part because roughly half have no access to a workplace retirement plan.
But California’s move also could also give a major boost to the Obama administration’s efforts to expand coverage for workers at the national level.
Learn more in my column this week at Reuters Money.