Segal releases new survey of multiemployer plans' zone status

March 4 2011

The Segal Company has released a new report outlining the zone status – green, yellow and red – of multiemployer pension plans in 2010.

The actuarial and investment firm found that more than half of the plans surveyed were in the green zone last year, a “significant increase from 2009,” when just 38% were in the green. Yellow-zone plans dropped from 32% in 2009 to 18% last year. The portion of plans in the red zone remained essentially unchanged – 29% in 2010 versus 30% in 2009.

“The results?showing a larger percentage of plans in the green zone in 2010 than one year earlier, demonstrate the impact on plans of the relatively strong investment performance that began in the second quarter of 2009,” as well as strategic decisions by plan trustees and negotiating parties, said the report’s authors, Phil Romello and Susan Lee.

“However,” they warned, “multiemployer plans are still facing formidable funding challenges triggered by the 2008/early 2009 market downturn and exacerbated by the recent recession. Many employers and unions in the industries represented in this survey predict that they will continue to fall short of their pre-recession employment levels.”

You can download a free copy of the report, Survey of Plans’ 2010 Zone Status, by clicking here.