Providing Americans with adequate retirement income and affordable medical care was one of the country's most hotly debated social and political topics of the 20th century. However, the times have changed, along with longevity, the medical cost of that prolonged longevity, and corporations’ ability to absorb the risks associated with multi-decade portfolios to finance those commitments. Over the past three decades, corporations in the private sector have successfully shifted the responsibility of retirement to individuals, as programs have been frozen or closed to new employees, with 401(k)-type saving programs acting as substitutes. What remains is a lingering program of the past that will slowly decline in size and number of covered retirees over the coming decades. For now, both pensions and OPEB remain a manageable cost with sufficient resources and cash flow to support them—even as sustained low interest rates may make funding levels worse for 2017. For 2016, corporate pension underfunding stood at USD 391 billion—6.1% higher than the USD 369 billion level of 2015, even as markets posted impressive double-digit gains. The funding level declined to 80.75% from the 81.14% posted in 2015 and the 81.12% posted in 2014. The most recent low-funding level was in 2012, at 77.26%, with the last full-funding level occurring in 2007, at 104.40%.
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