We talk a lot about automatic enrollment and automatic escalation. We also love to study industry data indicating related trends, which helps when our clients ask: “How many employers use automatic enrollment?” Results from a recent Callan survey show that the answer continues to be: “More than half, and more and more each year.”

Take note of these interesting results from the 2018 Defined Contribution Trends Survey:

  • 71% of plans use automatic enrollment
  • Slightly more than 25% apply it to not only new hires, but have also applied it to existing employees
  • Of those that do not use automatic enrollment, another 10% are very likely to implement the feature in 2018
  • 80% of the private sector plans with automatic enrollment are pairing the feature with automatic escalation
  • The average default enrollment percentage has increased to 4.6%, a sharp increase from 4.0% only a couple of years ago

These trends are encouraging. They reflect that plan sponsors have identified automatic enrollment and automatic escalation as a way to make saving – at a meaningful rate, nonetheless – easier for their employees. They also likely reflect that plan sponsors have become more educated and understand that their employees appreciate automatic features.

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