Segal: Multiemployer Plans Up 17% in 2003

June 16, 2004 ( - The strong equity gains that lifted single-employer defined benefit plans in 2003 did the same for multiemployer schemes that recorded a median return of 17.2% for the year.

The $18.4 billion multiemployer pension fund aggregate’s return equaled the return of a comparative 55% S&P 500 Index and 45% Lehman Bond Index portfolio for 2003.   By comparison, 2002 saw multiemployer plans drop 8.2% and in 2001 the group lost 2.4%, according to Segal Advisors’ Survey of the Universe of Multiemployer Pension Funds’ Investment Performance.  

Leading the investment portfolio gains were equity positions, which notched a median return of 31.4% in 2003.   This was a welcomed reprieve from double-digit losses recorded in these investments in both 2002 and 2001.   By comparison, the S&P 500 was only up 28.7% for the year.  

Fixed-income positions also ended the year better, returning 5.1% as of December 31, 2003. However, the latest figures were not as impressive as 2002’s numbers, when debt instrument investments in multiemployer plans were up 10.1%.