Double-digit annual returns for most U.S. public pension systems over the past two years have done little to shrink the yawning deficits facing many of them after a decade of inadequate funding, according to analysts and recent data.
Thanks to a robust stock market, most systems have enjoyed windfalls recently, with investment returns far exceeding projections. Even so, many are still struggling with shortfalls. In some cases, they have worsened as state contributions fail to keep pace with what is needed to pay beneficiaries.
Roughly half of U.S. state pension plans have worrying gaps between what they have promised retirees and the funds on hand to pay benefits, according to most analyses.