Employers that set up a 401(k) plan automatic enrollment program for new hires end up with significantly higher participation rates than other employers.

The average participation rate was 75% at auto enrollment plans in 2006, compared with an average participation rate of 68% at standard enrollment plans, according to researchers at Principal Financial Group Inc., Des Moines, Iowa.

The Principal researchers drew the figures from operating results for 38,600 full-service retirement plans served by Principal.

The typical default deferral rate at auto enrollment plans is either 3% or 4%, and, even before regulators came out with a final regulation excluding stable-value funds from a list of standard default investment options, the most popular default investments were lifestyle, lifecycle and asset-allocation funds, the Principal researchers report.

The Principal analysis also covers defined benefit plans, non-qualified plans and employee stock ownership plans.