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. You need to know this news in the fight for a secure retirement.
This week we saw evidence that our message of retirement security is gaining momentum in key states like Arizona, North Dakota, and Alaska. In North Dakota, NPPC Executive Director, Kendal Killian, wrote an op-ed in opposition to HB 1040, a bill designed to switch new hires into the North Dakota Public Employees Retirement System (NDPERS) from a defined-benefit pension plan to a defined-contribution 401(k) retirement plan. “North Dakotans cannot afford this risky gambit,” Killian writes. “Lawmakers are seriously talking about spending $5.5 billion in taxpayer dollars over 20 years to destroy the kitchen-table finances of North Dakota’s hard-working educators, nurses, and public employees.” In Arizona, retired educator Linda Somo detailed how important pensions are to retirees in the state and how critical the Arizona State Retirement System (ASRS) plays in retaining essential public employees. And in Alaska, where the fight to reopen a defined-benefit pension system is in full swing, lawmaker Andrew Gray wrote a piece for the Anchorage Daily News encouraging readers and his fellow legislators to address the state’s dire teacher shortage by offering career public servants what they deserve: retirement security in the form of guaranteed pension payments.
MissionSquare Research Institute released a new report this week detailing the financial health of the public service workforce and what state and local governments can do to address their workers’ needs. Some of the key findings from the research determined that public workers are, by and large, living with financial difficulties. For example, between 2017 through 2019, 14% of public sector employees reported that they could not pay all their household bills, and one-fifth of all public employees indicated they had skipped health care because they could not pay for it. The study also found that one-third of public employees do not have more than $400 in liquid assets saved for emergencies. Researchers did indicate that one way public employees shore up their financial health is through their benefits. Access to employer-sponsored retirement plans, health insurance, health and education savings accounts, and paid time off bolsters job security and leads to more effective budgeting and financial planning. Joshua Franzel, Ph.D., Managing Director of MissionSquare Research Institute, said, “This report offers a comprehensive snapshot of the financial health of state and local employees while also analyzing opportunities for their employers to optimize benefit offerings that underpin financial wellness while reducing employee stress, financial worries, and on the job distractions.”
Also this week, a poll conducted by Forbes Advisor echoed the MissionSquare Research. The Forbes poll found that pensions and retirement benefits are among the top three most important benefits employees seek in new jobs. The poll results provide conclusive evidence that pay rate is not always the determining factor in what keeps employees on the job. According to Forbes Advisor, 40% of employers say workers leave to find better employee benefits. The survey also uncovered that one in ten workers would take a pay cut for better benefits, and 34% of employees prioritize having a secure retirement benefit. This further supports our belief that pensions help employers recruit and retain employees, especially in the public sector.
Check back next Friday for the latest in the fight for a secure retirement! Sign up for NPPC News Clips to receive daily pension news from across the country directly to your inbox.