Ethnic differences in retirement wealth accumulation in the UK

About the talk.

Private pensions are the largest component of household wealth in the UK, and most employees are automatically enrolled into workplace pension schemes. Using new data that link employer-reported pension information with the population census, this session presents evidence that Bangladeshi and Pakistani employees are around twice as likely to opt out of their workplace pensions as employees from other ethnic backgrounds.

Opting out has significant financial consequences: employees forgo both their employer’s pension contribution and the generous tax subsidies associated with private pension saving. We estimate that a typical Pakistani or Bangladeshi employee who remains enrolled could have a retirement income roughly 60% higher than one who consistently opts out throughout their career.

These disparities in opt-out behaviour persist within firms and cannot be explained by differences in income, occupation, or other economic factors. Instead, the evidence points to the role of Islamic religious beliefs in shaping saving decisions – consistent with Islamic teachings on financial practices and interest-based saving. The session will explore this evidence and discuss its implications for pension policy and financial inclusion.

Read more about this fascinating research:

Ethnic differences in retirement wealth accumulation in the UK

Ethnic differences in private pension participation after automatic enrolment

Meet the presenter.

Laurence O'Brien, Senior Research Economist at the Institute for Fiscal Studies

Laurence is a Senior Research Economist at the Institute for Fiscal Studies (IFS) in the Retirement, Savings, and Ageing team and a part-time PhD student in Economics at UCL. His current research explores people's saving decisions, the intergenerational transmission of inequality, and the effects of government policies on people's retirement decisions.

Learn more about the series

Each year, the Office for National Statistics (ONS) organises a collection of online research events called the Research Excellence Series. The series showcases exceptional research projects that use a diverse wealth of invaluable research data. These data are used by researchers to produce new insights, inform change and make a difference in people’s lives.

Research Excellence Series 2025 will delve into the story of a unique research project. From inception to methodology, dissemination and impact. These sessions will be hosted by an eclectic range of speakers from across the research community.

This year’s series will include the winners from the ONS Research Excellence Awards 2024.

The events will take place through Microsoft Teams. They will also be recorded and available to watch later.

Getting in touch

For more information about this event, please visit the ONS SRS website, or email srs.engagement.team@ons.gov.uk.

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