PENSION SHUN? – Barely Half of Fortune 100 Now Offer Traditional Pension

July 26, 2000 ( - While nearly a third of the Fortune 100 now offer hybrid pension plans, just over half (52%) still offer a traditional pension plan, according to a new survey by Watson Wyatt Worldwide.

Just two years ago over two-thirds (68%) offered a traditional pension.

Controversy Notwithstanding

Despite the recent controversy regarding cash balance programs, 32% of the Fortune 100 offer a hybrid plan today, compared with 22% just two years ago.

At the same time, the number of firms offering only a defined contribution/401(k) plan has grown to 16% from 10% in 1998. An equal number offered those programs in 1985.

Distribution of Pension Plans Among Fortune 100 Companies
Type of PlanPercentage of Companies
Traditional Pension Plan*89%68%52%
Hybrid Pension Plan*1%22%32%
Defined Contribution/401(k) Only10%10%16%
* Most of these firms also have a 401(k)

The study defined hybrid pension plans as defined benefit plans where benefits are expressed in terms of immediate lump sum payments, rather than annuities after retirement.

This includes cash balance and pension equity plans.