NEW YORK--(BUSINESS WIRE)--Segal, a leading benefits and HR consulting firm, has released its 2021 Multiemployer Zone Status Survey. The Segal Zone Status Survey is based on the most up-to-date information compiled directly from Segal’s multiemployer pension plan clients.
The survey includes nearly 200 calendar-year plans, who were required to make a zone status certification by an April 30th filing deadline. This group of plans has more than $125 billion in assets, provides benefits to nearly 2.5 million participants, and represents approximately 25 percent of all participants in multiemployer plans. The recent temporary relief provisions under the American Rescue Plan Act of 2021 (ARPA) were not included in the survey but are discussed in Segal’s report.
“The Segal survey reveals that the pandemic had minimal impact on multiemployer pension plans. Though some financially challenged plans remain troubled, the fact that most plans remain solvent—despite 2020’s economic turmoil—demonstrates that the system is inherently sound,” said David Brenner, National Director of Multiemployer Consulting & Senior Vice President at Segal. “While troubled plans were granted an interim lifeline with new legislation, lawmakers need to develop long-term solutions that meet the needs of participants as well as current and future retirees.”
Across all industries, from entertainment to manufacturing and transportation, the majority of plans are in the green, healthy zone, the survey shows. It also revealed that:
- The average funded percentage for all calendar-year plans increased to 89 percent in 2021, up from 87 percent in 2020.
- On average, the percentage of calendar-year plans in the green zone increased to 72 percent in 2021, up from 70 percent in 2020.
- For the few plans in critical and declining status, those that are projected to become insolvent, the average funded percentage declined to 31 percent in 2021, down from 35 percent in 2020.
The zone status breakdown for plans in the survey shows modest improvement in 2020, primarily due to favorable investment returns. Out of the 58 plans that were not in the healthy, green zone and had room to improve their zone level, seven plans upgraded their zone status.
Segal provides trusted advice that improves lives. Segal is a privately-owned benefits, human capital, communications, technology, insurance brokerage and investment consulting firm with more than 1,000 employees throughout the U.S. and Canada. Segal, Segal Marco Advisors and Segal Benz are all members of the Segal family.