Even as employers scurry to make their workplace retirement plans more competitive in today's tight labor market, some are holding back on matching employee contributions.
In 2021, 5% of employers did not offer any kind of company contribution to their employees' retirement accounts, up from 4% in 2020, according to a research report Vanguard published in March.
Dave Stinnett, head of strategic retirement consulting at Vanguard, said he did not have specific information on why some plan sponsors did not make contributions but speculated that "it could just come down to companies prioritizing spending on other types of benefits."
Employers that did not make contributions to workers' retirement accounts were concentrated in the publishing or information industry, where 13% declined to offer the benefit. The publishing industry was followed by the legal services and utilities industries, where 11% and 9%, respectively, passed on making employer contributions.