Small and mid-sized employers surveyed by the Pew Charitable Trusts
most often cited expense (71%), limited administrative resources (63%),
and lack of employee interest (50%) as main reasons for not offering
Three-quarters of business owners who do not
offer a plan said that under current circumstances, they would be no
more likely to offer one in the next two years than they are now. Key
changes that could lead employers to offer a plan include greater
profitability, financial incentives, and increased demand from
When asked about individual retirement account (IRA)
plans funded entirely by employees that use automatic enrollment and
pre-determined deductions from their pay, employers without plans were
either somewhat or strongly supportive of the concept. Many said the
main reason for this support was that the auto-IRA plan would help their
State-Run Plans Not Widely Embraced
the same time, that support varied somewhat depending on which entity
served as the program sponsor. Support for an auto-IRA initiative proved
highest if the plan would be sponsored by an insurance or mutual fund
company; it dropped if a state or federal government ran the program.
Still, more than 40 percent supported a government-run program.
their state implemented an auto-IRA plan, 13% of businesses that
already have plans said they would drop theirs and enroll their workers
in the state program. Meanwhile, half of those without plans said that
they would start their own rather than go into the state program. For
employers that have been contemplating whether to start a plan, the
auto-IRA program might nudge them to consider plan sponsorship.
Employers expressed strong support for voluntary programs such as online marketplace exchanges or multiple employer plans.
Pew Charitable Trusts recently surveyed more than 1,600 small and
medium-sized business owners or managers to better understand the
barriers to—and motivations for—offering retirement plans and to get
their views on policy initiatives. The survey included employers who
sponsor plans and those who do not. The responses, in one of the few
such surveys conducted in the past decade, generally show strong support
for offering retirement benefits and for various policy initiatives
that would boost savings.
The Pew Charitable Trust’s Issue Brief about its findings is here.