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After several years of strong financial gains, many multiemployer pension plans are increasingly underfunded now due to the financial market impacts of COVID-19 in the first months of the year. A downturn in business activity related to the pandemic is also to blame, according to a study by international actuarial and consulting firm Milliman.

The multiemployer pension system’s aggregate funding level is estimated to have declined from 85% to 74% between January 1st and April 7th, the firm found, undoing much of the last decade’s improvement. That is equivalent to an additional $21,000 underfunding per active plan participant, unless the return on assets improves over current assumptions.

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