There's no question that auto enrollment represents a new cost for sponsors. The same Towers study showed nearly all Fortune 100 companies offered some kind of match to plans. Ergo, auto enrolling means more matches. 

Barbara Butrica and Nadia Karamcheva, authors of the Urban Institute study, noted that past research found sponsors who were reluctant to implement auto enrollment overwhelmingly cited the perceived cost of the match as the primary deterrent. 

But their analysis of 2010 compensation data from the U.S. Bureau of Labor Statistics found scant difference in sponsors' costs in plans with auto enrollment and plans without it – even though the plans with it had a higher participation rate — 7 percent higher, on average. 

Where the plans did differ was in the level of employer match. Plans without auto enrollment averaged a maximum employer match of 3.5 percent, while employers with it matched at a lower level, an average of 3.2 percent of pay. 

That suggests employers are offsetting the cost of having to match more employees by offering a less-generous match. 

Also, employers with auto enrollment set a low default contribution rate, on average 2.8 percent of a participant's salary. That's well below the 5.1 percent average that all plans require workers to contribute before employers make a match. 

By setting the default contribution rate well below what is needed to receive a maximum match, employers can encourage more workers to participate in their plans by adding auto-enrollment without necessarily increasing their costs, according to the researchers. 

In other words, with a few plan design tweaks, sponsors can indeed encourage higher participation levels without seeing their cost rise by much at all.

Also read: The shape of automatic enrollment to come