Despite recent increases in asset values and regulatory relief from the Internal Revenue Service, U.S. employers will be required to contribute $89 billion into their defined benefit plans in 2010 and more than $146 billion in 2011 unless they receive funding relief from the federal government, according to an analysis by Watson Wyatt.

Watson Wyatt analyzed the projected required contributions for single-employer defined benefit plans under various scenarios and found that past relief granted by legislation and regulations had lowered required contributions for corporate pension plans to $32 billion in 2009 from $38 billion in 2008, but that without further action, employers’ contributions would “explode” to more than $146 billion in 2011. Without additional funding relief, the average regulatory funded status would decline slightly from 96.4 percent in 2008 to 93.8 percent in 2009, and then fall to 83.8 percent in 2010 and to 76.8 percent in 2011, the analysis found.

“The combination of a deep recession and new pension law has landed employers in extraordinary circumstances, and they need temporary funding relief to lessen the enormous pension contributions required in the next few years,” says Watson Wyatt spokesperson Mark Warshawsky.