About one in five Americans lives in rural areas and small towns across the United States, and they face unique economic challenges compared with those living and working in other areas of the country. Many of these communities, for example, still have not fully recovered from the Great Recession in 2008.
Earlier this month, the National Institute on Retirement Security (NIRS) released a new report titled “Fortifying Main Street: The Economic Benefit of Public Pension Dollars in Small Towns and Rural America,” which showed how public pensions provide an economic boost to these areas.
The report examines how pension benefits impact gross domestic product (GDP) and total personal income across 1,401 counties in 19 states. It finds that “rural counties experience more of an impact in terms of personal income than metropolitan counties” and that “small-town counties experience a greater relative impact both in terms of GDP and total personal income from public pension benefit dollars than rural or metropolitan counties.”
Rural states like Wyoming witnessed a particularly large net benefit from public pensions in 2018. Eight of the state’s 23 counties had benefits make up at least two percent or more as a percentage of its GDP, and seven counties had benefits make up at least two percent or more of the percentage of total personal income.
This report from NIRS makes it clear that we can’t afford to leave retired public employees in rural areas and small towns behind. We must continue to protect pensions in 2020 and beyond, as public pensions benefit local economies and provide a much-needed boost to the personal incomes of these retirees.