The funded status of public- and private-sector pension plans is a classic example of bad news/good news. To wit: Some states’ pensions are in bad shape, but funding of public-sector pension plans overall is improving; corporate pensions’ funded status fell in April, but only very slightly.
State and local pension liabilities may amount to $4 trillion, says BenefitsPro, citing a Nelson A. Rockefeller Institute of Government report. But the problem may not be widespread: Illinois alone accounts for $187 billion in pension liability, and New Jersey another $52 billion. And there is progress: Wilshire Consulting reported that state pension funding status stood at 75 percent by 2013, according to Bloomberg, which also notes that National Association of State Retirement System Administrators Research Director Keith Brainard said during a May 2 online conference that public-sector pension funding is getting better overall, and that his organization expects broad improvement.
As for the private sector, ISSG reported that the typical U.S. pension plan’s funded status fell 1.1 percentage points in April. Andrew D. Wozniak, head of ISSG’s Fiduciary Solutions group, attributed April’s drop to “significant declines by small cap stocks and private equity.” Even so, corporate plans’ funding stood at 91 percent by April.
John Iekel is Senior Writer and Editor for the ASPPA Net and NTSA Net portals.
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