US. Government money should help solve this pension crisis
For those of you who do not think about pensions on a daily basis, multiemployer plans are private sector defined-benefit plans created by collective bargaining agreements between a labor union and two or more employers. They typically exist in industries with many small employers.
While the majority of multiemployer plans are returning to financial health since the financial crisis, a substantial minority — covering about one million of the 10 million participants — face serious funding problems and could run out of money within the next 15 to 20 years. These plans have been deemed “critical and declining.”
The size of the “hole” (the difference between assets and the present value of promised benefits) for “critical and declining” multiemployer plans is between $35 billion and $76 billion, depending on the interest rate used to discount promised benefits. One plan — Central States Teamsters — accounts for about 45% of the problem.
Read More: Market Watch
