Pensions Rise Amidst Change

The financial struggles of the railroad industry led to congressional intervention through the Railroad Retirement Act to safeguard pensions. Post-World War II, demographic shifts showed an increase in the aging population, with projections indicating an even larger percentage by 1980. Two significant government policies fostered the expansion of pension schemes: a tax on excess profits, which made pension plans more appealing to employers, and a freeze on cash wages, prompting businesses to enhance non-cash benefits like pensions to attract employees. By war's end, one-sixth of the U.S. workforce held pensions, predominantly benefiting professionals, while blue-collar workers remained largely excluded. Additionally, the National Labor Relations Act of 1935 empowered workers with union rights and collective bargaining.