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Public Pensions Face Worst Funding Decline Since Great Recession

  • Funding ratio to drop to 77.9%, losing half of 2021 gains
  • Calpers, the biggest pension, lost 6.1% in latest fiscal year


Photographer: David Paul Morris/Bloomberg

US public pension funds are on pace for their deepest financial setback since the Great Recession as turmoil in global markets this year threaten to leave taxpayers and government workers on the hook.

Steep stock and bond losses are set to leave state and local pensions this year with enough to cover 77.9% of all the benefits that have been promised, down from 84.8% in 2021, according to the New York-based nonprofit Equable Institute. That reflects almost a half trillion dollar increase in the gap between assets and what’s owed to retirees. The biggest US fund, the California Public Employees’ Retirement System, said this week it lost 6.1%, its worst performance since 2009.