# of Fortune 1000 Firms Freezing Pensions Still Growing

A Watson Wyatt news release said that 190 firms on the 2009 Fortune 1000 list have a frozen defined benefit (DB) pension plan, compared with 169 companies last year and only 45 six years ago. Overall, the rate of DB plan sponsorship in the Fortune 1000 decreased slightly to 61% in 2009 from 63% in 2004.

The news release said industries with higher DB plan sponsorship rates, such as utilities and manufacturing, are less likely to freeze a plan than those with lower sponsorship rates.

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class=”normalweb2″> However, companies in industries that have been severely affected by the economic crisis – financial services and automobile industries in particular – are exceptions. Almost half of the DB plan sponsors in the financial services industry and one third of the DB plan sponsors in the automobile industry have frozen plans.

class=”normalweb2″> Meanwhile a separate Watson Wyatt analysis found that freezing pensions does not boost a companies’ market value. The analysis of 82 publicly-traded companies that froze or closed their pension plans between 2003 and 2007 found that there is an insignificant or negative impact on stock prices associated with the announcement of a pension freeze or close.

class=”normalweb2″> More information is available at www.watsonwyatt.com/Fortune1000pensionfreezes .

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class="normalweb2"> The number of DB plan sponsors with frozen plans has been increasing steadily since 2004.

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class="normalweb2">Source: Watson Wyatt