The rate of pension plan freezes among Fortune 1000 firms has slowed and most firms with defined benefit(DB)plans are committed to keeping them, according to Watson Wyatt.
An analysis of pension plan sponsorship among Fortune 1000 companies shows that the share of plan sponsors freezing their plans dropped to 4% in 2007, down from 7% in 2006.
“Undoubtedly some companies will freeze their pension plans in the future, but it appears that trend has peaked,” says Kevin Wagner, a senior retirement consultant at the firm. “With less regulatory uncertainty and funding volatility better under control, the environment is now a more positive one for pension plan sponsors.”
A separate study of 300 organizations with pension plan assets of more than US$100 million found that 59% of companies with a DB plan open to new hires have made a formal decision to keep their plans open. The remaining 41% have not said whether they’ve made a formal decision about their plans.
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