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Hewitt: More Firms To Drop 401(k) Match

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About 2% of large employers have cut or suspended 401(k) matching contributions in the past few months, and 5% say they plan to do so this year.

Researchers at Hewitt Associates Inc., Lincolnshire, Ill., have published those figures in a summary of results from a recent survey of about 150 large and midsize employers.

About 51% of the employers surveyed already offer an automatic enrollment program. An employer that adopts auto enrollment makes matching contributions even for employees who have not taken active steps to enroll in a plan.

The percentage of employers without auto enrollment programs that said they are somewhat or very likely to add auto enrollment for new hires has fallen to 25%.

A year ago, about 57% of the employers surveyed said they were somewhat or very likely to add automatic enrollment for new hires, Hewitt researchers report.

The percentage of plan participants offering target-date funds has increased to 77%, from 66%, and about 49% offer automatic account rebalancing.

The percentage of participant plan assets in stock funds has dropped to 53%, from 67%, and the percentage in stable-value funds has increased to 33%, from 12%.

The percentage of employers planning to pay for in-person investment education seminars or classes in the coming year has fallen to 72%, from 60%, but 60% are using e-mail blasts, and 49% are using Webinars.


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