By: Russ Kamp, CEO, Ryan ALM, Inc.
Milliman released the 2025 output for its Multiemployer Pension Funding Study (MPFS), which analyzes the funded status of all U.S. multiemployer DB pension plans. The analysis incorporates the assumptions and data from each fund’s Form 5500 filing.
As of December 31, 2025, Milliman estimated the aggregate funded ratio reached a robust 103%, up significantly from 97% at year-end 2024. Milliman’s analysis finds that the rise in funding is largely due to strong asset gains during the year, but they also note that aggregate annual contributions have far exceeded the costs of benefit accruals and administrative expenses for several years, leading to the MPFS funding improvement.
Tim Connor, MPFS co-author, stated that “we’re seeing the results of proactive measures by many multiemployer plans to strengthen their funded status levels through increased contributions and benefit adjustments.” He went on to say that “over the past decade total contributions were approximately $331 billion, while total benefit expenses and admin costs were $212 billion.” The surge in contributions is not surprising given the injection of roughly $75 billion in Special Financial Assistance (SFA) granted through the ARPA legislation and implemented by the PBGC.
Milliman further reported that SFA totaling $5 billion (about 0.6% of all multiemployer assets) also contributed to the MPFS funding improvement during 2025. They calculate that $75 billion from an estimated $79 billion in SFA funding has already been distributed under the American Rescue Plan Act of 2021. Click on the link below to view the entire report.
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Why wouldn’t such well-funded plans take steps to lock in the funding of their beneficiary payments through a cash flow matching portfolio? Isn’t the first fiduciary duty of loyalty expressed in controlling the relevant risk to the beneficiaries, which involves BOTH securing adequate assets and then actually funding the payments? Many of these plans have hit the first goal but are still exposed to funding risk. With a ready solution at hand, the plan sponsors open themselves to criticism for not taking action on their second responsibility.