Industry Analysis & Industry Trends
The Pension Funding industry provides an income for those that no longer work. The UK pension system comprises a mandatory state component and a private component, but the Pension Funding industry excludes the state pension system. The industry has endured volatile conditions over the past five years. Voluntary contributions came under pressure due to high levels of unemployment and falling real incomes. However, automatic enrolment in pension schemes, which was introduced in October 2012, positively influenced contributions. Meanwhile, significant quantitative easing activity undertaken during the past five years, combined with historically low interest rates, propelled financial markets and stimulated investment returns, contributing to growth... purchase to read more
Industry Report - Starting a New Business Chapter
The Pension Funding industry has moderate barriers to entry. Barriers are higher for occupational schemes, which require employees to make contributions.
Economies of scale
Scale is important in the industry. Larger funds enjoy substantial economies of scale with regards to investment options and fund expenses. These funds have the capacity to invest in asset classes such as commercial property and alternative investments, which may be beyond the reach of smaller funds. Larger pension funds also exhibit lower average costs per member given that fixed costs can be distributed more evenly, as opposed to smaller funds that cannot spread the burden of managing a pension fund as successfully as a larger fund... purchase to read more