The 11th Annual Transamerica Retirement Survey has found that almost half of U.S. employers are optimistic about the U.S. economy and their own company’s financial situation.
However, the survey – conducted among a nationally representative sample of 601 U.S. employers – found that most companies continue to be reluctant to make significant changes to their retirement plans such as adding or enhancing key plan features.
“Most employers understand that these plans are important to their employees and are key retention tools,” Catherine Collinson, president of the Transamerica Center for Retirement Studies, said in a statement. “By adding a retirement plan – or enhancing existing retirement benefits with automatic features, investment advice, and retirement income options – employers can increase their impact in helping their employees prepare for a secure retirement.”
• Nearly half of employers (49%) expect their company’s financial situation to improve over the next 12 months, compared to only 29% in the year prior.
• 45% of companies surveyed indicated they expect the economy to improve in the next 12 months, compared to 27% in the year prior. Relatively few companies expect their financial situation to worsen (13%) or the economy to worsen (19%) in the next 12 months.
• The majority of companies surveyed (82%) reported they now offer a 401(k) or similar employee funded plan, up from 78% the previous year. Of those companies, those that reported offering a matching contribution fell to 69% from 76% the year prior.
• For companies that don’t currently offer a plan to employees, 87% indicate that they are unlikely to in the near future, with 74% “not at all likely.” This is a sharp increase from the prior year’s survey in which only 59% indicated they weren’t likely, and only 43% “not at all likely.” This shift was much more prominent among small businesses.
• 27% of employers automatically enroll employees into their company sponsored retirement plan, up slightly from 24% the previous year. Large companies (43%) remain much more likely than small companies (25%) to automatically enroll employees. Of employers that do not automatically enroll their employees, most (84%) do not plan to in the future.