The Pension Protection Act of 2006 is having a positive effect on 401(k) plans, according to Fidelity Investments.

Most notably, 51% of Fidelity’s 11.7 million 401(k) participants are in plans that have automatic enrollment, up significantly from 16% five years ago. Furthermore, 73% of the plans Fidelity administers default their participants into lifecycle funds up from 11% in 2006.

Since 2006, Fidelity plans that offer auto enrollment have grown to 21%, up from 2%. Without auto enrollment, the average participation rate for employees is 55%. With auto enroll, it jumps to 82%.

The numbers are even more significant among the 20 to 24 age group: a mere 20% participate in their 401(k) plan if left to their own devices, but if they are automatically enrolled, 76% are saving in their 401(k) plan.

“The PPA is proving to be one of the most significant legislative initiatives helping American workers save for retirement,” said James M. MacDonald, president of workplace investing at Fidelity. “While the PPA enabled sweeping reforms across workplace retirement savings plans for all workers, it has had the greatest impact on younger investors. The auto features have significantly boosted participation among younger workers and have simplified the investing process.”

-- This article first appeared on Money Management Executive.