Pension Deficits Plague Corporate America
Pension deficits plague Corporate America. Companies are facing major liabilities stemming from promises they made to their employees. Due to these pension deficits, many companies are struggling financially. As of 2013, companies in the S&P 1500 had more than $3.5 trillion in liabilities related to pensions, an increase of almost $1 trillion from 2008, according to a study by Preqin. If these pension liabilities were to go unpaid, it would have a serious impact on the overall financial health of these companies. This is because pension payments are a significant portion of a company's overall revenue. Pensions are a critical part of the retirement plan for many employees. When companies make promises to their employees regarding pensions, they are essentially gambling with the future retirement security of their employees. If companies are unable to pay their pension liabilities, they will likely have to lay off employees or reduce their pension contributions. This would have a big impact on the middle-class and lower-income workers who rely on pensions to make ends meet in retirement. This problem is only going to get worse as baby boomers start to retire. The Baby Boom generation is expected to have $26 trillion in retirement savings, which is more than the total assets of