A majority of 401(k) plan sponsors have said that they haven’t felt the need to stop or eliminate contributions during the coronavirus pandemic, according to a new survey by the Defined Contribution Institutional Investment Association.
About 86 percent of plan sponsors said they aren’t considering suspending matching employer contributions, just 8 percent said they already have. Meanwhile, 92 per cent said they aren’t considering reducing those contributions, with just 3 percent saying they’ve done so.
These surveys are always funny because they state the obvious. According to the survey, only a small amount of companies have reduced or eliminated matching contributions, that’s because 13 percent of plan sponsors said they’ve laid off employees, while the same amount said they’ve actually increased hiring in certain departments. If a survey would suggest 20% of more of plan sponsors cutting back or eliminating matching contributions, that would be like a depression.
