Survey: Retirement Plan Cutbacks to Stay in 2010

A majority of employers that made changes to their retirement plans in response to the economic downturn expect to keep those changes in 2010, according to a new Buck Consultants Survey.

A Buck news release said 77% of employers with defined benefit plans and 52% of employers with defined contribution plans will not reverse changes or are uncertain if they will reverse previous changes.

The most common changes employers made to DB plans in response to the downturn were to freeze participants’ benefits at their current levels (68% of plans covering salaried employees) and to close the plan to new employees (32% of plans covering salaried workers).

Twenty-four percent of respondents elected to make changes to their DC plans during 2009. The most common change was to reduce employer contributions. Only 6% of respondents with a DC plan with employer matching contributions reported increasing their match during 2009.

More than 40% of survey respondents reported that their DB plan’s funded status had lost more than 20% of its value due to the economic downturn.

The study analyzed responses from nearly 200 organizations.