Many top companies kick in more to help employee retirement funding
Some of Pittsburgh's top employers are getting more generous when it comes to helping workers save for retirement at a time when Americans are rebuilding their nest eggs from the financial crisis.
A report released Tuesday by BrightScope Inc., a San Diego financial information firm, showed overall improvement among the top 401(k) programs offered by the region's employers, from plastics makers to energy companies and law firms, as companies and workers stepped up contributions and plan fees were held in check.
Nova Chemicals, a Canadian-based manufacturer of products for the food packaging industry, had the best overall 401(k) program in the region, according to BrightScope's ranking of the top 25 plans in the region. The plastics maker has 400 employees total at a plant in Monaca and its offices in Moon.
Germany-based Bayer Corp., which employs 2,200 people in the region and has its MaterialScience unit headquarters in Robinson, was second on the BrightScope list.
Among those top 25 plans in Pittsburgh, average company contributions were $6,876 a year, compared to a national average of $4,300 a year, said Brooks Herman, head of data and research at BrightScope.
The boost in retirement benefits may reflect renewed awareness of the importance for offering such benefits to attract and retain staff, said Bob Hapanowicz, president of Downtown wealth manager H&A Wealth.
“We see employers making more of a commitment to their employees' futures,” said Hapanowicz, who was not involved in the BrightScope report. “Employers recognize that it's very high cost to replace an employee. ... It's a tool to maintain cost control.”
Bayer spokesman Christopher Loder said offering competitive benefits is important to fostering a positive work environment.
“Benefits contribute to individual and family health, increase financial security by helping employees save for the future and help create a comfortable work-life balance that improves quality of life,” Loder said.
The rankings were for programs with more than $100 million in assets in 2012, the latest year for which data was available. A 401(k) plan is a retirement savings plan companies offer in which employees contribute some of their income before taxes, and employers often match a portion of that contribution. It is named after a section of the federal tax code.
Nova scored a regional best 89.25 on the BrightScope rating system, which considered fees charged, employer contributions, the participation rate, level of employee salary deferrals and overall account balances.
A spokesman for Downtown-based Ariba Inc., which was third on the list, could not be reached.
Allegheny Technologies Inc. ranked fourth. The supplier of specialty steel and titanium products, which reported $3.9 billion in revenue, has offered competitive retirement benefits for some time, said spokesman Dan Greenfield.
“We like getting the recognition,” Greenfield said. “But our employees have enjoyed a very good 401(k) program for many years.”
Beyond boosting contributions, employers are doing more to help workers make investment decisions.
Bank of New York Mellon Corp. ranked 20th on BrightScope's list with a score of 78.75. The bank, which employs 7,600 in the region, gives employees a variety of investment options in its 401(k) program, as well as professional investment advice and online tools to help employees set an investment strategy and monitor performance, said spokeswoman Lane Cigna.
“With retirement savings as the largest financial goal for many Pittsburghers, news like this encourages employees to think about all the options available to them in their 401(k) plan, including their employer's match and the range of investing options that can provide the potential for diversified, long-term returns,” said Adrienne Cook, director of total compensation management at Federated Investors.
Chris Fleisher is a staff writer for Trib Total Media. He can be reached at 412-320-7854 or email@example.com.