Pots of Money?
One of the most commonly cited statistics associated with the discussion of small pots and their consolidation is that we hold, on average, eleven jobs in a working lifetime – and that this number is tending to increase, that there is greater job mobility. However, a search for the original source of this figure proved fruitless.
There is a reference in a US Congressional Budget Office publication to this number for the US but again no source even there. The closest that we could come was the December 2011 DWP paper “Meeting future workplace pension challenges: Improving transfers and dealing with small pension pots”. This contains the following figure
The reference cited in the paper referred to in note 16 above is again the DWP:
So, this figure of eleven jobs in a working lifetime is a modelled simulation not an empirical fact.
The ONS does collect statistics on job transfers in the annual survey of hours and earnings (ASHE)
The following figure is taken from its April 2019 Compendium Analysis of Job Changers and Stayers
These are changes of job rather than change of employer, which would be the relevant consideration for the number of pension pots. The ONS reports that 75.4% pf these changes are changes of employer. This would result is an average of just 3 jobs in a working lifetime. Even if we allow for the differential rates of job change at different ages (illustrated below) we do not get above an average of 3.5 jobs per working lifetime.
The discrepancy between these two sources is material – 11 jobs versus 3.5, we need to resolve the difference if we are to base policy and business plans on consolidation of small pots soundly.
While we are at that we should also examine the proposition that the pandemic has resulted in different employee behaviour. There is evidence that this is true of the US labour market (see below) – and anecdotal evidence that it may also be true here, though perhaps not to the same extent (and of course confused by Brexit effects).
