Workplace pension scheme membership slipped to a 15-year low in the UK during 2012, official figures show.
Just 46% of employees belonged to a workplace pension last year, marking the lowest level recorded since similar data began in 1997, according to Office for National Statistics (ONS) figures.
Pensions experts said that 2012's trough should be reversed in the coming years amid landmark Government efforts to get more people saving for their old age.
The ONS said the fall has been driven by a declining membership of defined benefit (DB) schemes, such as final salary schemes, which promise people guaranteed incomes when they retire, regardless of how well underlying investments have performed. Employers have increasingly said such schemes are too expensive for them to keep open for new members and they have replaced them with defined contribution (DC) schemes, where the worker shoulders more of the risk and their pension depends on how well their investments have done and what sort of annuity they buy.
The ONS's Annual Survey of Hours and Earnings found a "significant difference" between the private and public sectors. More than eight out of 10 (83%) public sector workers were members of a workplace pension scheme last year, compared with less than a third (32%) of private sector employees. Many public sector pensions are still DB schemes, which has caused them to be dubbed "gold-plated", as they offer certainties that many schemes in the private sector cannot match. The ONS figures showed that 91% of public sector employees with a workplace pension are in a DB scheme, compared with just a quarter (26%) in the private sector.
No strong regional variations in terms of pension membership were found by the ONS, although in the private sector, membership was at its highest in the South East at 37% and at its lowest in Wales at 29%.
Membership of workplace pensions started to dip below 50% in 2010 and it stood at around 47% in 2011.
The latest findings from the ONS were collected just before the Government's automatic enrolment scheme kicked off last autumn, which will eventually see around 10 million people automatically placed into workplace pensions. The reforms began with larger firms, and moves are also taking place within the industry to make pension schemes more transparent and attractive to savers.
Joanne Segars, chief executive of the National Association of Pension Funds, said: "We hope that this is the worst things will get. Millions will be automatically put into a pension in the coming years, so the only way is up. Auto-enrolment is a great opportunity to turn the situation around and get more people saving for their retirement."
Minister for pensions Steve Webb said: "The scale of the challenge is clear, too few people are saving for their retirement, which is why our pension reforms are so crucial. Last year we acted to make sure that all workers will have access to a workplace pension. Firms employing over a million people have already started enrolling their employees into pensions, finally reversing the downward trend."