PPI study finds one in five higher earners facing retirement shortfall

One in five (20%) UK workers face risks of inadequate retirement incomes despite relatively high earnings, according to research by the Pensions Policy Institute (PPI)¹. The PPI's annual UK Pensions Framework report, embargoed until 0900 on Wednesday 4 November 2026, was posted on its site on 3 November 2026 under the title "High pay not enough: 1 in 5 workers face retirement shortfall risks"³.

The report modelled six representative worker profiles and found that a higher-paid private sector worker may build relatively less pension wealth than a lower-paid public sector worker, because employer contributions were closer to minimum automatic enrolment levels and some elements of remuneration were not fully reflected in pension saving². Lower-paid workers with access to stronger employer pension provision, including defined benefit (DB) schemes, were found to be better positioned to maintain their living standards in retirement; this group accounted for 11 per cent of the UK working population². The PPI said the findings challenged the assumption that retirement adequacy can be understood primarily through earnings¹. It is the fifth report in the UK Pensions Framework series and was sponsored by Aviva².

Lauren Wilkinson, senior policy researcher at the PPI, said:

The PPI called on the Pensions Commission to take a more holistic perspective, considering where additional saving can realistically come from, how earnings and pension saving are unevenly distributed, and how institutional pension provision affects retirement adequacy¹. The report also said the balance between individual, employer and state responsibility may need to shift as workers' ability to build private pension wealth changes, and that differing causes of low pension saving present different policy challenges².

Why it matters for households

The finding concerns people whose pay is above average but whose workplace pension saving is comparatively weak. For that group, the amount going into a pension, including the employer's contribution, matters as much as salary in determining retirement income¹. The report's comparison is between a higher-paid private sector worker on employer contributions close to minimum automatic enrolment levels and a lower-paid public sector worker with stronger employer provision, including DB schemes². The PPI assessed adequacy against the Pensions UK Retirement Living Standards, and modelled fund size and contributions through working life as well as income in retirement¹. The research does not report individual shortfall amounts, and no figures for the size of the gap have been published in these reports.

What happens next

The PPI report comes as the Second Pensions Commission prepares to deliver its final report in spring 2027². The PPI has asked the Commission to consider pensions alongside housing and wider household wealth, and the respective roles of individuals, employers and the state¹. Michele Golunska, managing director of wealth at Aviva, said the findings "highlight the need to look beyond income when considering adequacy"².

For background on building retirement income, see our guide to pensions and our explanation of how much you need to retire. Pensions dashboards are intended to show all of a person's pensions in one place.