The Pension Benefit Guaranty Corporation released its Fiscal Year 2019 Annual Report and, you guessed it, it was “un-good” (a legal term I think). The Multiemployer Insurance Program recorded a record-breaking deficit of $65.2 billion. The PBGC warned that the Multiemployer fund will likely be insolvent by 2025, within 6 years from today. Without the PBGC insurance fund, the pensions of 10.8 American workers will be at risk. Read the Report Here.
Regular readers of this space may recall I have blogged about the impending crisis four times over the last five years. “Teamsters’ Central States Pension Plan: A Saga Becomes a Nightmare?” (Aug. 16, 2016); See “The Gift-Giving Season? Three “Game-Changing” Employment Developments Impacting Manufacturers” (Oct. 15, 2014); “Teamster Plan to Cut Pensions Presents Significant Issues for Manufacturers” (May 25, 2015); and “A Troubling Future Part One: Teamsters’ Pension Rescue Plan” (Oct. 22, 2015). While Congress has held hearings on legislation to attack the problem, time seems to be running out. Some of the nation’s largest multi-employer pension plans are likely to become insolvent during the next decade. Without a comprehensive fix, the pensions of hundreds of thousands of retired American workers will be slashed. The resulting fallout will stress an already fragile social safety net.
We will continue to watch this space and help manufacturers plan for events as they develop.