Decisions, Decisions: An Update on Retirement Plan Choices for Public Employees and Employers
Public employees with retirement plan choice overwhelmingly choose defined benefit pension plans over defined contribution 401(k)-type individual accounts.
Among the eight states studied that offer employees such a choice, the DB pension take-up rates in 2015 were 80 percent or higher in six states. Two of the plans studied had pension take-up rates higher than 95 percent, while Florida and Michigan had take-up rates of 76 percent and 75 percent, respectively. Importantly, the research finds that even when the retirement plan default option favors a DC plan, most employees still select a DB pension plan.
For example, in Washington the default retirement plan is a combination DB/DC plan. Employees must affirmatively act to elect to participate in the DB pension plan instead, and they do. The majority of newly-hired employees – six out of every ten new hires – actively choose a pension plan.
The research is co-authored by Jennifer Brown, manager of research for the National Institute on Retirement Security (NIRS) and Matt Larrabee, principal and consulting actuary with Milliman.
Debunking the Job-Hopping Myth: A Data-Driven Look at Tenure and Turnover Among Younger Workers
Contrary to popular belief that Millennials and Generation Z employees are constantly switching jobs, new research from the National Institute on Retirement Security finds that younger workers today show job retention patterns that closely mirror previous generations at the same stage of their careers.
Evolution and Growth: How Public Pension Plans Have Diversified Their Investments Amid Changing Markets
A report from the National Institute on Retirement Security (NIRS) and Aon examines the changes public pension plan investing has undergone throughout the twenty-first century.
Pensionomics 2025: Measuring the Economic Impact of Defined Benefit Pension Expenditures
Pensionomics 2025: Measuring the Economic Impact of Defined Benefit Pension Expenditures finds pending powered by U.S. private and public sector defined benefit pensions contributed significantly to the economy. In 2022, retiree spending of public and private sector pension benefits generated $1.5 trillion in total economic output, supporting 7.1 million jobs across the nation.
In partnership with AARP and NRTA, NIRS has developed a series of state-by-state infographic fact sheets regarding the public employee and teacher retirement systems across the country.
These fact sheets present a snapshot of these retirement systems along with key data from NIRS research and other sources.
