While employers continue to make sizable cash contributions to their pension plans, declining interest rates and, to a lesser extent, weak asset returns, reduced the average funded status of Fortune 1000 pension plans by four percentage points during 2011, according to a new analysis by Towers Watson.
The analysis examined U.S. pension data of 422 Fortune 1000 companies and estimated their funded status for 2011 as reported for financial accounting purposes. The results indicate that the average pension funded status declined from 80% at the end of 2010 to an estimated 76% at the end of 2011. This marked the first year since 2008 that pension plan funding levels declined. Average funding levels had improved in both 2009 and 2010 largely due to positive stock market returns and significant employer contributions. Overall, employers contributed more than $70 billion into their pension plans in 2011.
