The number of employers offering a sponsored retirement plan slightly increased in 2012 from four years prior, while matches and employer contributions remained near constant, according to a survey released today by WorldatWork and the American Benefits Institute.

In 2012, 94% of employees said their company provided a 401(k) plan, compared to 91% in 2008, the Trends in 401(k) Plans and Retirement Rewards report of about 500 employees nationwide found. However, the survey summary says that these numbers may be skewed due to the fact that more than 71% of companies involved employee more than 1,000 people and the report’s name, which may have signaled to potential participants that only those who offer a 401(k) plan should participate.

While the number of companies offering plans is high, participation remains high as well. Seventy-three percent of the respondents say that greater than 70% of their eligible employees participate in the employer-sponsored plan. And of those participating, 77% say the average employee contribution was greater than 5% of salary per paycheck, with 53% of companies reporting an average contribution of 5-7%.

In fall 2011, the Internal Revenue Service announced that it was raising the maximum contribution allowed to $17,000 in 2012, up from the $16,500 limit in 2011.

Further, the study found that the 2008 financial crisis did not significantly alter 401(k) contributions. Almost nine-out-of-ten companies report their company neither suspended nor eliminated their company matching contribution during the previous five years. In fact, for 77% of companies surveyed, there was no change in the 401(k) matching formula and they are not considering a change in the future.

WorldatWork and the American Benefits Institute saw room for continued education on retirement plans due to employees not contributing the maximum to their retirement plan and not taking advantage of the full employer match being offered.

“Employers may be able to help improve employee contribution rates by implementing automatic escalation features, in which participant contributions gradually rise over time or with salary increases,” the study suggests.

The future of 401(k) plans remain unclear as Washington eyes their tax-favored status. They are among the costliest tax breaks.


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