A significant number of U.S. employers that still offer defined benefit pension plans are committed to providing those benefits to new salaried employees, according to a survey Towers Watson. The survey also finds that employers are adding features to their defined contribution plans that mirror DB design to help close possible savings gaps created by the shift from DB to DC plans.
The Towers Watson survey, based on responses from 424 midsize and large employers with DB plans, found that more than two-thirds (68%) of respondents that currently offer a DB plan to new salaried employees are committed to offering the plan to new hires over the next two to three years. Just over one-third (36%) of DB sponsors currently offer the plan to new employees. The survey also reveals that support for DB plans is strongest at companies that cover the most participants: Among the largest 10th percentile of respondents, 45% still offer a DB plan to new hires.
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