The largest impact to date has been on private pension schemes which have seen an average decline of over 23% or USD 5.4 trillion in their investments across the OECD, according to the new OECD report Private Pensions Outlook
. Two thirds of the losses (USD 3.5 trillion) are estimated to be in the United States alone, with the United Kingdom, Australia, Canada, the Netherlands, and Japan accounting for a further USD 1.4 trillion.
Pension funds, which account for most private pension assets, have been hit hardest in OECD countries where equities make up over a third of total assets invested. Irish pension funds experienced the worst investment performance, losing 33% of their value in real terms.
Occupational defined-benefit schemes are adding to the pressure that the crisis is already putting on companies; many employers are finding it increasingly difficult to finance the pension promises made to their current and former employees.
Public pension schemes are also starting to feel the effects of rising unemployment rates, falling wages and, consequently, a decline of contribution revenues.