Lower life expectancy reduces corporate pension costs
More Americans are dying at younger ages, and one silver lining is that it's reducing pension costs for corporations and the government, Bloomberg reports. The analysis shows that at least 12 large companies like GM and Verizon have said that this trend has reduced their pension obligations a combined $9.7 billion.
- Why it matters: That corporate America is quantifying the effects of this rise in age-adjusted death rates to shareholders underscores just how remarkable this trend is. "Even in previous years, you've seen a slower degree of improvement for the pensioners, but you haven't seen a decline in life expectancy," Aon actuary Eric Keener told Bloomberg.
- Why it's happening: One theory is social disconnection and dysfunction particularly in working-class white communities, as so-called "deaths of despair" from suicide and drug addiction have increased.
- It's not just the U.S. Canada and Britain are also seeing slow improvement in life expectancy.