Jeff Kempker, CEBS, CRC
A new study by the National Institute on Retirement Security (NIRS) shows that income retirees receive from public pension plans, like LAGERS, produce positive economic impacts across the nation. The study, using 2016 data, reports public pensions are responsible for $1.2 trillion in total economic output in the U.S. and added $202.6 billion in government revenue from retiree income taxes and spending.
In Missouri, retiree income from the state’s public pension plans, including LAGERS, supported $7.2 billion in total economic output within Missouri and $1.3 billion in federal, state, and local tax revenue.
Public pension plans are a good investment for Missouri taxpayers. These plans help government employers attract and retain quality workers to serve the public. Plus, every $1 invested in public pensions by Missouri taxpayers produced $6.01 of total economic output within the state.
Looking closer at LAGERS’ numbers, there were over 20,000 LAGERS retirees living in Missouri last year. Total payments to these retirees were around $286 million. Using NIRS figures, LAGERS retirees alone produced $409 million of total economic output within our state!
Public pension plans are an investment in our communities. As with any investment, those putting in the money want to see positive returns. Pensions enable government employers to provide quality services to the public because they are better able to attract and retain good people. When these good people retire, they are likely to remain living in the same community, spending their earned pension money and paying taxes. The investment made by taxpayers comes full circle.
