Assessing Pension Benefits Paid under Pennsylvania's State Employees' Retirement System

Research Report

Assessing Pension Benefits Paid under Pennsylvania's State Employees' Retirement System

Abstract

Pennsylvanias pension plan for state employees receives a failing grade in the Urban Institutes state and local pension plan report card, and ranks as the third-worst plan in the nation covering newly hired general state employees. The plan scores poorly because it is inadequately funded, it penalizes work at older ages by reducing lifetime benefits for older employees, and it provides few retirement benefits to short-term employees. Age-25 hires must work 32 years before they accumulate rights to future pension benefits worth more than their required plan contributions. Various pension reforms could distribute benefits more equitably across the workforce.

Cross-Center Initiative

To reuse content from Urban Institute, visit copyright.com, search for the publications, choose from a list of licenses, and complete the transaction.