Aided by improved investment returns, the average funding level of large U.S. employers’ pension plans rose in 2003, but the funding level still remains well below that of a few years ago.

On average, defined benefit plans sponsored by Fortune 1000 companies were 88% funded in 2003, up from 82% in 2002, according to a Watson Wyatt Worldwide survey released Wednesday.

The improvement in plan funding stemmed in part from a 19% average return on assets, a dramatic improvement from 2002, when plans reported an 8.3% average loss on assets.

An increase in employer contributions also helped boost plans’ funding level. In 2003, surveyed employers pumped a total of $71.6 billion into their plans, up from $44.3 billion in 2002 and just $14.0 billion in 2001. Watson Wyatt projects that surveyed employers will contribute about $40.0 billion this year to their plans.

Despite the improvement in 2003, plans’ average funding level is far below that of a few years ago, when the equities market generated hefty investment results. For example, in 1999, surveyed employers’ plans were 131% funded on average.

The findings are based on annual reports filed by the 622 Fortune 1000 companies sponsoring defined benefit plans last year.