Multiemployer Plan Health Declined in 2012

February 27, 2013 ( – Segal’s Survey of Plans’ 2012 Zone Status indicates overall multiemployer pension plan health declined in 2012.

From the end of 2011 to the end of 2012, the percentage of plans in the green zone decreased from 63% to 60%. In contrast, the percentages of yellow-zone and red-zone plans increased slightly during that period to 14% and 26%, respectively.   

The average Pension Protection Act of 2006 (PPA’06) funded percentage for the surveyed plans was 84% in 2012, which represents a slight decrease from 2011.  

The percentage of plans in the green zone was higher than in 2010 (53%) and 2009 (38%); however, it remains far below the 2008 high of 80%, prior to the market downturn that began later that year.The percentage of yellow-zone plans was relatively constant from 2011, while the percentage of red-zone plans increased 2 percentage points.  

The retail trade and food industry, which represents a relatively small sample size, experienced the largest decrease in the percentage of green-zone plans and the largest increase in yellow-zone plans. The industry with the greatest percentage of red-zone plans remains transportation.  

Under the Pension Protection Act, the “yellow zone” represents endangered status, the “red zone” is critical status, and the “green zone” is for plans in neither of the other two categories.     

Segal’s survey report is here.