Pension assets across the OECD reached USD 78 trillion at the end of 2025 – equivalent to 106% of GDP and between four and five times their level in the early 2000s. But the OECD Pensions Outlook 2026, which specifically focuses on asset-backed pensions, finds that many workers are still not saving enough to reach their retirement income objectives. TUAC welcomes the Outlook’s attention to retirement preparedness but warns that it underplays the role of low pay and precarious work.
The Outlook’s figures show the size of the shortfall. Among the 41 countries covered, only in Luxembourg would all groups of workers attain a retirement income that maintains their living standards without having to make additional contributions. In 17 of these countries, male employees on average earnings would need to pay at least an additional 10% of their wages into a voluntary pension plan to close the gap. The OECD itself signals that these are minimum estimates, and that it may be too optimistic to assume workers keep contributing throughout their careers.
The indicator does not fully reveal the extent of labour market inequalities, TUAC cautions, because they are already built into workers’ contribution histories. The fact that the contribution gap is larger for women in only 17 countries should therefore not be interpreted as evidence of limited gender inequality in pension systems. OECD data on pension benefits show that women receive lower pensions than men in almost every OECD country, highlighting how structural labour market inequalities continue to translate into unequal retirement outcomes.
TUAC urges the OECD to give affordability greater prominence in explaining these contribution gaps. The Outlook lists affordability concerns among the barriers to voluntary saving, alongside behavioural biases and limited financial literacy. It acknowledges that low-income earners may prioritise short-term budgeting over pension contributions, while higher-income earners are more willing to trade current pay for future pension benefits. Trade unions point out that workers hit by rising housing, food and energy costs often have little left in the household budget to set aside for retirement.
Inequalities in retirement often start in the labour market, TUAC argues, and the OECD’s broader work points the same way. Low wages, insecure work, involuntary career breaks and weak collective bargaining coverage all lead to smaller pension pots and less adequate incomes in old age.
TUAC calls on governments to combine measures that raise participation in asset-backed pensions with policies that strengthen workers’ capacity to save – higher real wages, quality and secure jobs, strong social protection systems and broad collective bargaining coverage.
Pension gaps are a defining challenge, and the OECD is right to put them on the agenda. But when a low-paid worker does not pay into a pension fund, that is often a rational response to the struggle to make ends meet.
