From Davos to the White House: Meaningful Actions on Portable Benefits
“Basic benefits should be just as mobile as everything else is today.” - President Barack Obama, 2016 State of the Union Address
Major questions about the Future of Work continue to get top billing, including amongst the financial and political elite last week at the World Economic Forum in Davos. From how to reshape a workforce system so it is focused on skills, diversity, and flexible work arrangements to building a modern social contract, participants grappled with how to shape the fast-approaching economy of tomorrow. The WEF also released a framing report titled “The Future of Jobs” that anticipates major changes and disruption of significant portions of the global economy over the next five years, impacting millions of jobs.
It can be easy to get overwhelmed with the size of these potential changes, and the necessary scale of the response required across sectors in order to manage the impact and possible dislocation. But important solutions like portable benefits will start with small steps that build momentum, inform our thinking, and embrace innovation by testing out new models. That is the impetus that led 40 leaders from across the spectrum to call for portable benefits policies last November.
Today’s announcements by the White House and the Department of Labor are an important next step — actions that will advance our understanding of what workers want and need, and help design a 21st Century system of benefits and protections to meet those needs.
The commitments and proposals are primarily focused on expanding access and adding flexibility to the retirement system — a core worker benefit that currently penalizes mobility and worker flexibility — but also include important components for portable benefits more broadly.
- Expanding access to open multi-employer pooled retirement plans, which could include independent contractors.
- Budget proposal for grants to states and non-profits to pilot innovative portable approaches to retirement and other employment-based benefits.
- Evaluations of existing portable benefits models, with a particular view toward replicability (and what scaling might look like).
- BLS / Census commitment to new insight and data (Contingent Worker Supplement) so we can better understand contingent work and the on-demand economy.
These actions build on the momentum from the President’s remarks during the State of the Union, and are an important step forward for all workers. They are consistent with our goal of new models for flexibility and stability, and we welcome the commitment from the Administration to additional data, to understanding different portable benefits models, and investing in pilots so we can understand what works and help take it to scale.
Lenny Mendonca/Natalie Foster/Libby Reder/Greg Nelson