State and local government employees in Connecticut have the highest average annual pension amount in the United States, says a new study by the U.S. Census Bureau.
As of 2011, said the agency, Connecticut’s average annual pension for state- and locally-administered pensions was $35,079. Nationally, the average was $25,135.
For state employee pensions alone, the gap widens: $37,953 average for Connecticut state retirees, $24,139 average for all other state employee retirees.
Only a handful of states (California, New York, Rhode Island, Colorado and Nevada) joined us over the $30,000 mark for state and local government workers.
Another interesting fact: State and local government employees in Connecticut contributed 20.8% to their pension accounts—much less than the national average of 29.5%.
The Census Bureau’s report follows closely on the heels of another study this summer that flagged how significantly underfunded are Connecticut’s state employee and teacher pensions.
CNBC reported that funding for those pension accounts--at an average of 55%-- was far short of the 80% that’s most recommended and responsible.
To be sure, Connecticut is a high-cost, high quality of life state. So in one sense the richness of state employee pensions is understandable.
But the other side of the tally sheet—including the facts that our pension accounts are underfunded; Connecticut’s per person pension debt is 5th worst in the U.S.; and there are fewer active state employees and teachers contributing to their retirement funds our economic growth—shows that we should be very concerned.
Especially considering the fact that Connecticut’s economic recovery is lagging the rest of the U.S. (reported the Bureau of Economic Analysis).
The challenge is to figure out what kinds of reforms could make our state employee pension system more fiscally responsible and stable. What are other states doing to fix their pension problems? What can taxpayers really afford?
State fiscal stability is one of the building blocks of a sound economy and healthy business climate. Being able to afford and fund reasonable retirement benefits for state employees is a major factor in determining Connecticut’s fiscal stability.
Policymakers need to step up efforts to address this enormous challenge.