For Immediate Release
December 1, 2015

Multiemployer Defined Benefit Pension Plans Continue to Gain Financial Stability
2013 Plan Funding Levels Nearly Recovered From 2008 Market Collapse; Shifting Demographics Pose a Challenge for the Future

Brookfield, Wisconsin—A report from the International Foundation of Employee Benefit Plans and Horizon Actuarial Services, LLC, finds that despite the financial volatility caused by the 2008 Great Recession, the majority of multiemployer defined benefit pension plans remain financially stable and have seen an increase in funding levels and overall assets.

The report, The Multiemployer Retirement Plan Landscape: A Ten-Year Look (2004-2013), analyzes key trends in demographics, cash flows and investments for defined benefit and defined contribution plans over the ten-year period from 2004 through 2013.

"The ten years represented in this report have brought major changes to the multiemployer plan landscape—the Pension Protection Act of 2006 (PPA), investment losses, economic turmoil, funding relief," explained Jason Russell, consulting actuary, Horizon Actuarial Services, LLC. "Plan trustees have been focused on implementing action plans to recover from the 2008 investment losses and challenges from the Great Recession. Strong investment returns combined with trustee actions have allowed most multiemployer pension plans to improve their funding levels in recent years."

Key Multiemployer Defined Benefit (DB) Pension Plan Findings:

Plan Numbers: As of December 31, 2013, there were 1,387 multiemployer DB pension plans—1,349 of which were financially solvent. These plans have total assets of $460 billion, up from $400 billion in 2012. The plans serve 10.4 million participants and beneficiaries.

Plan Investments: Investment returns for multiemployer DB plans were quite volatile over the past decade. In the 2008 calendar year they saw a median investment return of -23.5%. The stabilizing market resulted in double-digit returns in four of the five years from 2009 through 2013.

Plan Funding: Plan trustees have taken significant action to improve plan funding levels. As of December 31, 2013, the median funded percentage was 86% (based on the market value of assets). This is a significant improvement over the median funded percentage at the end of 2008 (68%) and is approaching the median funded percentage prerecession in early 2008 (89%). The increase in funding allowed more plans to enter the "green zone" under PPA. For 2013, 57% of plans had green zone status, up from 34% in 2009.

"The higher investment returns and increased funding levels of plans are good signs, but plans on the whole are becoming more mature," said Russell. "When you look at demographics and net cash flows, it's clear that plans are aging and tilting toward more inactive versus active members."

At the end of 2004, the median ratio of active participants to inactive participants was nearly 1:1, meaning there was almost the same number of active participants, with contributions made on their behalf, as there were inactive participants. By the end of 2013, the median ratio of active to inactive participants was 6:10.

"To gain financial stability going forward, trustees will need to have a greater focus on the aging demographics of their plans," said Russell. "As plans become more mature, it becomes more difficult for them to improve funding levels with changes to contribution levels or future benefit accruals. Trustees may want to evaluate their funding and investment strategies to make sure they are in line with their plans' demographics."

Key Multiemployer Defined Contribution (DC) Retirement Plan Findings:

Plan Numbers: As of December 31, 2013, there were 1,132 multiemployer DC retirement plans. These plans have total assets of more than $120 billion and cover more than 3.7 million participants and beneficiaries. A majority of these plans—at least 80%—are offered in tandem with a DB plan.

Plan Investments: The volatile economy over the past decade significantly impacted investment returns for multiemployer DC plans. In 2008, the median investment return was -21%; in 2013, the median investment return was 15%.

"Despite challenges, multiemployer plan trustees are doing the best they can to sustain DB and DC plans," said Julie Stich, CEBS, director of research at the International Foundation. "These plans provide critical benefits to ensure the retirement security of workers and their families."

This is the third year the International Foundation of Employee Benefit Plans and Horizon Actuarial Services, LLC, have compiled this report. Data was collected using publicly available information from Form 5500 filings, with 2013 being the most recent information available.

The Multiemployer Retirement Plan Landscape: A Ten-Year Look (2004-2013) can be downloaded at


International Foundation of Employee Benefit Plans is the premier educational organization dedicated to providing the diverse employee benefits community with objective, solution-oriented education, research and information to ensure the health and financial security of plan beneficiaries worldwide. The Foundation has more than 33,000 multiemployer, corporate and public sector members representing over 25 million lives. For additional information, visit

Horizon Actuarial Services, LLC is a leading consulting firm specializing in providing innovative actuarial solutions to U.S. multiemployer benefit plans. Horizon Actuarial serves roughly 100 pension and welfare benefit plans from various industries, including construction, trucking, hospitality, entertainment, retail food, and communications. Horizon Actuarial helps clients address an extensive range of issues, from pension plan implementation, to health and welfare fund reserve analysis, and everything in between. With Horizon Actuarial's experience comes an understanding of the unique dynamics of multiemployer plans, keeping both labor and management well informed and well equipped to navigate the challenges facing their plans.


Brenda Hofmann | (262) 373-7756