Welcome to the latest edition of This Week in Pensions! We have gathered the best stories about pensions and retirement security from the previous week. This is the news you need to know in the fight for a secure retirement.
Public Pension Systems Pared Costs and Assumptions in 2021, NCPERS Study Finds by National Institute on Public Employee Retirement Systems. New report by the National Conference on Public Employee Retirement Systems (NCPERS) revealed several trends regarding public pension funds across the country. Among key findings, the report revealed that the majority of pensions generated an average of 68% of revenue from investments. The report also revealed that the average funding levels increased. For systems that participated in the 2020 and 2021 study, their funding levels grew from 71.7% to 72.3%. Nationally, systems that participated reported an average of 74.7%. The data emphasizes how resilient public pensions are, and how secure they are for the long-term.
Public sector benefits can off a hiring and retention advantage during the great resignation, according to the MissionSquare Research Institute by MissionSquare Research Institute. New research by MissionSquare Research Institute shows that benefits provided by the state and local governments are more likely to incentivize new workers to join the workforce, as well as retaincurrent employees. State and local employees have access to a wide variety of benefits including, defined-benefit and defined-contribution retirement plans, healthcare, paid leave, and life insurance. According to the report, defined benefit pension plans are offered to 86% of state workers, while defined contribution plans are extended to slightly over 38%. With the mass amount of labor shortages stretching across the nation, benefits offered by the state and local government prove to be even more critical when it comes to sustaining the future of public sector industries, especially during the Great Resignation. MissionSquare Research Institute Managing Director Joshua Franzel, Ph.D., said, “given the range of recruitment and retention challenges public employers of all sizes face in 2022, now more than ever, it is important for state and local leaders to understand and optimize public sector benefits to be employers of choice.”
Pritzker promises tax relief, education, pension money thanks to ‘smart budgeting’ — but GOP smells ‘election year gimmicks’ by Mitchell Armentrout. On Wednesday, Illinois Governor J.B. Pritzker delivered his annual “State of the State” address, which included his proposed budget for FY 2023. One priority – tackle the state’s very neglected pension system. After decades of underfunding by previous lawmakers, Governor Pritzker continues his commitment to help shore up those state’s pension funds. His budget includes contributing an extra $500 million towards the fund. If his proposal succeeds, it would be the first time since 1994 that the state contributed more than its annual legal requirement. According to Pritzker, the additional dollars could save the state $1.8 billion in interest. Funding public pensions enhances their cost-effectiveness, and ensures stability for both current and future retirees.
