Most 403(b) Sponsors Kept Match during Downturn

December 2, 2009 ( – Nearly three-fourths (73.4%) of 403(b) plan sponsors in a recent poll said they did not change their employer match during the 2008-2009 plan year.

A news release said the poll, from the Profit Sharing/401k Council of America (PSCA), also found that 43% of plan sponsors surveyed say they increased employee education because of the economic conditions. Another 17% added investment advice for employees. The Principal Financial Group sponsored the study.

“Retirement plans are a vital part of not-for-profits’ strategies to attract and retain the best employees. The study shows that a large majority of them stepped up to the plate to support the plans—and their employees—during the recession,” said David Wray, president of PSCA, in the news release.

According to the news release, only 16.6% of plan sponsor respondents reported a decrease in plan participation during 2008-2009, and just 16.9% experienced a drop in employee deferrals. However, participation did suffer among those organizations that suspended their matching contribution. Just over 50% of organizations that suspended their match reported a decrease in plan participation compared to only 12% of organizations that did not make changes to the match.

Other survey findings include that among 403(b) plan sponsors who reduced their matching contribution, 23.5% will reinstate the match during the next six months. Among 401(k) plan sponsors who reduced the match, 41.3% will restore the match during the next six months.

Smaller organizations were more likely to report reducing or suspending their non-matching contributions, while larger organizations were more likely to reduce or suspend their matching contributions.

Finally, the survey found 13.3% of 403(b) plan sponsors are unsure of their ERISA status.

The PSCA poll covered 609 403(b) plan sponsors from across the country. More information will be available at, under Research.