When the COVID-19 virus-plagued stock market carved a chunk out of Vermeer Corp.'s 401(k) plan, most participants shrugged it off.
The plan had assets of $341.3 million as of Dec. 31, but by the end of March, it was $294.2 million, or down 13.8%.
However, only 64 of 4,116 plan participants — employees and retirees — made reallocation changes between Feb. 24 and March 31, said Cheri Klyn, director of shared services for Vermeer, a Pella, Iowa-based manufacturer, in an April 9 interview.
"We have seen very little activity for investment changes," said Ms. Klyn, adding that aggregate assets had inched back to $307.2 million as of April 15.
Another encouraging sign of people "staying the course" was the annual report on plan participants using auto-escalation, which is 1% a year of annual pay up to 12% of annual pay. The annual results, calculated each April 1, showed that 11% of participants opted out this year vs. 12% last year, Ms. Klyn said.
"Our people have not had much of a financial impact at this point because for the most part we are still working," she explained.
There haven't been layoffs, although the company has staged staggered shutdowns of plants to reflect changes in demand for products, which include drills for laying underground utility cables, tree chippers, cable plows, trailers and pipeline trenchers.
To reduce costs, Vermeer asked employees to take two weeks off by July 31. They could choose paid time off or forgo salary and be eligible for unemployment for those two weeks, Ms. Klyn said.
"I think over 800 are working from home, but the factories are still working and have implemented a lot of new practices to limit exposure and transmission of the disease," she added. (Some employees — with 3D printers at work and at home — are making visors for medical face shields, she said. Vermeer is working with RP America, New Sharon, Iowa, to make the face shields for health-care workers at Pella Regional Health Center.)
Vermeer's investment adviser and fiduciary, Intellicents Inc., has prepared a series of online brochures to emphasize long-term investing and to counsel against short-term panic in response to the COVID-19 crisis.
"We wanted to answer common questions," said Brad Arends, co-founder and CEO of the firm, based in Albert Lea, Minn. "The biggest questions were how long will the volatility last? How long will it take to catch up?"
The online brochures focus on reminding participants to keep contributing and to understand the concept of dollar-cost averaging as well as to refrain from panic selling.
The eight-week campaign, which is still in progress, is illustrated as a journey for participants "to pick the right road," he said.
