Have Localities Shifted Away from Defined Benefit Plans?
A new issue brief highlights changes in local government retirement plans as compared to state plans with respect to shifts away from traditional defined benefit structures. As of 2018, 19 percent of large localities had a defined contribution (DC), cash balance, or hybrid plan for new hires, instead of a stand-alone defined benefit (DB) pension. Government contribution rates for the local alternatives are lower than for the DBs they replaced, and employees are likely to see lower investment returns.
While the 2018 figure represents an increase from 11 percent offering non-DB plans in 2001, the actual cost impact to local governments will be tempered by the fact that such changes typically apply only to new employees.
Employee Preferences on Financial Wellness
SLGE’s new survey data on state and local government employee opinions about financial wellness programs is now available, including what types of information they want and need, how they would like the information communicated to them, and their views on employers’ roles in offering financial wellness programs.
Registration is also open for an upcoming webinar on Public Pension Plans (hosted by American Academy of Actuaries), Thursday, April 23, 12-1:30pm EDT.
In addition a recording is available for download of SLGE’s recent webinar on “How Does the Public Health Workforce Compare with the Broader Public Sector?”
SLGE in the News
The Broadcast Retirement Network featured an interview with Research Director Dr. Rivka Liss-Levinson on the public health workforce and establishment of individual Medicare marketplaces. Click here to view the podcast.
Plan Sponsor quoted SLGE President and CEO Dr. Joshua Franzel on retirement planning for those not participating in Social Security.
Public Management magazine featured an article on community engagement and recruitment by Senior Research Associate Gerald Young.
Pensions & Investments covered the SLGE brief on local governments’ shift from defined benefit plans and cited data from the Public Plans Database in discussing the pandemic’s impact on pension funds. Others covering the DB to DC shift included the National Association of State Treasurers (NAST) and Idaho State Journal.
Watch for upcoming research, including the annual workforce survey conducted in partnership with IPMA-HR and NASPE, the 2020 SLGE/CRR state and local pension funding update, and SLGE/ICMA-RC polling on the K-12 workforce and the impact COVID-19 is having on state and local employees.
SLGE gratefully acknowledges the financial support from ICMA-RC to undertake much of this research and supporting the Public Plans Database.
During these extraordinary circumstances, SLGE continues to extend our appreciation to all state and local government employees in all roles and geographies.