The vast majority (89 per cent) of eligible employees in Great Britain were saving into a workplace pension in 2024, with around 21.7 million eligible employees saving, figures from the Department for Work and Pensions (DWP) have revealed.

This marked an increase of 0.8 million more eligible employees saving and a 1 percentage point increase in the pension participation rate compared to 2023.

The DWP said that this increase was more substantial than previous years, attributing this to the number of employees brought into auto-enrolment (AE) eligibility.

Broader improvements were also seen, as the overall workplace pension participation rate of all employees in Great Britain continued to be around 8-in-10 (82 per cent) in 2024, with 23.3 million employees saving, marking a 0.9 million increase compared to 2023.

This was primarily because the earnings trigger has remained frozen in recent years (currently £10,000), as well as changes made to Annual Survey of Hours and Earnings (ASHE) data, which now suggest that a greater number of higher earners who are more likely to be saving into a workplace pension.

Total pension savings have also improved in real terms, as the DWP found that total annual workplace pension savings for eligible savers was £149.7bn in 2024, which is a £49.1bn real-terms increase compared to 2012 (in 2024 earnings terms).

Overall in 2024, contributions by employees accounted for 29 per cent of saving, with employer contributions accounting for 62 per cent, while income tax relief on the employee contribution the remaining 8 per cent. 

Despite the overall improvements, the DWP noted that there are some groups which a noticeable pension participation gap. 

In particular, it found that less than two-thirds (59 per cent) of eligible employees working for a micro employer (those with less than 5 employees) in the private sector are saving into a workplace pension. 

In addition to this, 68 per cent of Pakistani and Bangladeshi eligible employees are saving into a workplace pension. 

The figures also revealed broader changes in the market, revealing that whilst the vast majority, 95 per cent, of the 12.8 million individuals in receipt of a private pension payment in 2024 to 2025 are in receipt of a defined benefit (DB) or an annuity, this is slowly changing.

Indeed, when assessing private pensions accessed for the first time, the proportion receiving a lump sum or other defined contribution product has risen from 37 per cent (280,000) in the 2016 to 2017 financial year to 48 per cent (390,000) in the 2024 to 2025 financial year.

This could leave savers more vulnerable to adequacy issues, as previous research from the DWP found that four in 10, or nearly 15 million people, are undersaving for retirement.

And industry experts have warned that participation alone is not enough to address growing retirement adequacy concerns, with Isio head of DC pensions, Richard Birkin, arguing that "participation may look stable on the surface, but that masks deeper cracks when it comes to pension adequacy". 

He stated: "For too many, especially those in ‘Middle England’, minimum contributions are unlikely to deliver a retirement that matches their expectations or needs.
 
“Recent pension reforms bring this to the front of minds and while momentum is building around raising contributions, it must be done in a way that’s fair, phased, and flexible. The goal shouldn’t just be to increase the amount going in, but to ensure that savers see genuine long-term value in doing so.
 
“Getting people to save is only half the battle. We also need to focus on how those savings are turned into reliable income in retirement. Poor decumulation options are letting too many people down at the point where support is most needed.

"Without better products and support at the point people access their savings, we risk falling short on outcomes even if we succeed on inputs. We’ve made huge progress on participation. The next step is making sure it translates into genuine retirement security.”

This was echoed by Legal & General DC & workplace savings CEO, Paula Llewellyn, who warned that "saving something isn’t the same as saving enough".

"If the government lowered the auto-enrolment age from 22 to 18, the average person could be 15 per cent better off at retirement," she stated.

"The powers are already there, and countries like Australia and Canada have shown it works. It’s time for action, not just engagement. We need to make it easier for people to start saving earlier and set them on track for a stronger financial future.”

PensionBee director of public affairs, Becky O’Connor, also stressed the need for reform, arguing that "there is a clear-cut case for the government to turn its attention to how to improve long-term saving among those currently left out of the system".

“The demand for pensions among workers who are not auto-enrolled is there, as rates of pension saving in this group have increased between 2023 and 2024 seemingly organically, so a policy push is likely to be successful and well received," she stated.

“PensionBee’s Invisible Worker campaign highlights that more than a million ‘gig’ economy workers are not currently paying into a pension. PensionBee is calling for reforms that prioritise simplicity, affordability, and broader eligibility.”

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