The Pension Market

Multiemployer Pension Plans Funded At 91% Overall At Year-End 2021

Milliman analysis shows aggregate funding levels improved in 2021

Milliman’s December 2021 Multiemployer Pension Funding Study reports on the estimated funded status of all U.S. multiemployer defined benefit (DB) plans as of December 31, 2021. View complete study here.

SEATTLE, Feb. 14, 2022 /PRNewswire/ — Milliman, Inc., a premier global consulting and actuarial firm, today released the 2021 year-end results of its Multiemployer Pension Funding Study (MPFS), which analyzes the funded status of all multiemployer defined benefit pension plans in the United States.

As of December 31, 2021, the aggregate funded percentage of all multiemployer plans climbed to 91%, from 88% the year prior. The study’s assumed asset portfolio earned 12.0% for the year. Strong investment returns lifted multiemployer pension funding in 2021, despite increased pension liabilities due to declining discount rates. The average discount rate is now below 7.0%, with nearly half of all plans lowering their discount rate over the past five years.

“Data is just beginning to come in that shows the effect of COVID-19 on multiemployer pensions, though the magnitude of the impact will vary by plan and industry,” says Nina Lantz, a principal at Milliman and co-author of the MPFS. “We saw a decrease in total contributions for better funded plans – likely because of lower workforce levels – however total contributions for critical plans increased during the pandemic due in part to rehabilitation plan requirements or withdrawal liability income.”

Impact of COVID-19

Some data has begun to emerge from plan filings, but it is too early to draw definitive conclusions. For example, the study analyzed 2020 contribution information for calendar year plans and found, when compared to 2019, that aggregate contributions for green and yellow zone plans dropped about 5%, while contributions for red and deep red zone plans increased 2% to 3%. Contribution income in the aggregate was surely influenced by decreased workforce levels in some industries due to COVID-19. However, unhealthy plans may have seen an increase in contributions due to rehabilitation plan requirements and/or withdrawal liability income despite the impact COVID-19 may have had on workforce levels.

Data is just beginning to come in that shows the effect of COVID-19 on multiemployer pensions, though the magnitude of the impact will vary by plan and industry...

Over half of all plans (668 of 1,216) are at or above 100% funded. Eighty percent of all plans (976) are 80% funded or better. Under the Pension Protection Act (PPA), plans that are at least 80% funded generally fall in the green zone. However, these plans still face significant risks, such as those related to economic volatility and growing plan maturity. Trustees must remain vigilant in managing these and other plan risks to keep these plans in the green zone.

Ten percent of plans (121) are below 60% funded and may be headed toward insolvency. These plans may have exhausted all reasonable measures to adjust contributions and benefit levels to the maximum extent possible. The SFA program established by the American Rescue Plan should provide much needed relief to many of these plans. However, the application period for most eligible plans is scheduled to open on March 11, 2023, so the impact of SFA will not be seen for a few years.

Plans As Of Year-End

As of 2021 year-end, over half of all plans in the MPFS were 100% funded or better, and 80% of plans have a funded ratio of at least 80%. There remains roughly 10% of plans in the study that are under 60% funded. Many of these plans are likely to apply for Special Financing Assistance (SFA) provided by the American Rescue Plan Act of 2021, which was passed back in March 2021. To date, five plans have been approved for SFA totaling nearly $1 billion. SFA amounts are expected to have a meaningful impact of funding percentages in the years to come.

To see Milliman’s full range of annual Pension Funding Studies, visit here. To receive regular updates of Milliman’s pension funding analysis, contact us at




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Milliman is among the world’s largest providers of actuarial and related products and services. The firm has consulting practices in healthcare, property & casualty insurance, life insurance and financial services, and employee benefits. Founded in 1947, Milliman is an independent firm with offices in major cities around the globe. For further information visit