Fidelity Reports More Employers Reinstate 401(k) Match in 2010

More Than 70 Percent of Large Companies Have Reinstated or Plan to Reinstate Employer Contribution

BOSTON--()--Fidelity Investments, the No. 1 provider of workplace retirement savings plans, today released findings that indicate many employers, both small and large, are reinstating employer matching contributions to their 401(k) plans.

Larger employers are leading this trend with the majority of them indicating they have either already reinstated or will reinstate over the next 12 months. This data is based on a March 2010 survey of the 293 Fidelity defined contribution plan sponsors that in 2009 reported they had eliminated or reduced their employer contributions.

By July of 2009, eight percent of companies with an employer contribution among Fidelity recordkept 401(k) plans had suspended the match as the economy continued to weaken and employers looked for ways to cut costs. When surveyed this month about their intentions of bringing back the match, 44 percent of all employers regardless of size indicated they have either already reinstated the match or plan to over the next 12 months.

“As the economy begins to improve, employers large and small are bringing back their 401(k) matching programs,” said James M. MacDonald, president of Workplace Investing, Fidelity Investments. “Our experience has shown that the presence of a match has a significant impact on employee participation levels, which makes these programs critical to getting workers back on track with saving for their retirement.”

According to the latest survey, reinstatements were more common in larger companies. In fact, Fidelity found that in companies with 5,000 or more employees, roughly 70 percent reported already having reinstated the match or planning to do so in the coming 12 months. The rate was smallest at companies with 500 or less employees, where 36 percent reported a reinstatement or planned reinstatement in the same time period.

Four Out of Five Companies Offer an Employer Match

Fidelity research indicates that as of December 31, 2009, four out of five (80%) plan sponsors offered employer contributions to retirement savings plans as a workplace benefit.

Of the plan sponsors for which Fidelity tracks matching data, the most common match rate is 100 percent on each employee dollar contribution, up to 3 percent, at 35 percent of plans. The second most common match, with 14 percent of plans reporting this rate, is 50 percent of each employee dollar, up to 6 percent.

Match Helps Drive Employee Participation

Companies may wish to take a close look at employer contributions as they are one of the leading drivers of employee engagement in tax-deferred retirement savings plans. Research has found that a company match, regardless of the rate, increases participation in retirement savings plans. The average employee participation rate for companies that offer a match is 63 percent. At companies that do not offer a match it is 57 percent.1

About Fidelity Investments

Fidelity Investments is one of the world's largest providers of financial services, with assets under administration of over $3.2 trillion, including managed assets of $1.5 trillion as of February 28, 2010. Fidelity offers investment management, retirement planning, brokerage, and human resources and benefits outsourcing services to over 20 million individuals and institutions as well as through 5,000 financial intermediary firms. The firm is the largest mutual fund company in the United States, the No. 1 provider of workplace retirement savings plans, the largest mutual fund supermarket, a leading online brokerage firm and one of the largest providers of custody and clearing services to financial professionals. For more information about Fidelity Investments, visit

Fidelity Brokerage Services LLC, Member NYSE, SIPC
900 Salem Street,
Smithfield, RI 02917


1 Fidelity Nondiscrimination Testing data as of December 31, 2007.


Fidelity Investments
Corporate Communications, 617-563-5800


Fidelity Investments
Corporate Communications, 617-563-5800