The brief’s key findings are:
- While most multiemployer pension plans are finding their financial footing, a substantial minority face serious problems.
- The key reason is a declining financial base, which results in negative cash flow.
- Plans deemed in “critical” condition can raise contributions, cut future benefits, and/or cut “adjustable” benefits that apply to retirees as well as active workers.
- To date, plans have focused on raising contributions and cutting adjustable benefits, with less emphasis on cutting benefit accruals for active workers.
- Nevertheless, a simple model suggests that one third of “critical” plans could exhaust their assets within 30 years.