Studies Find Post-Election Improvement in Pension Funding
Funded ratios have improved for private- and public-sector pension plans since the November elections, according to recent reports.
The Wilshire Consulting division of Wilshire Associates reported that the aggregate funded ratios of corporate pension plans
improved in November by 3.3 percentage points and hit 80.6% by the end of the month. It attributed the improvement to a drop in liabilities that far outstripped the drop in asset values; those decreases were 5.2% and 1.2%, respectively.
And another division of the firm, Wilshire Trust Universe Comparison Service, said on Feb. 7 that growth in the U.S. equities market that took place from Election Day to New Year’s Eve helped fueled an improvement in the funded ratios for small and large public plans
. For 2016, the improvement for small plans was just under 7% and for large plans, almost 8%.
Corporate pension plan funded ratios improved overall for 2016 as well, according to Wilshire Trust Universe Comparison Service. Small private pension plans’ ratios improved by just over 6%, and large plans’ were just over 7% better by Dec. 31. And that trend has continued, according to Milliman, which says that in its Milliman 100 Pension Funding Index
the funded status of the 100 largest private-sector pension plans improved in January. Their collective funding deficit was $325 billion on Dec. 31, but stood at $316 billion one month later, MlIliman says.