Fewer California state employees took their pensions in October, a sign that the promise of higher wages and better retirement benefits that go with them has slowed retirement rates.
According to CalPERS data, 715 state workers drew their first pension checks in October, down 10 percent from the same month in 2014. It was the fifth consecutive month that year-over-year state retirements declined. For the first 10 months of this year, 6,361 state employee have headed for the exits, 7 percent fewer than January through October of 2014.
By comparison, October marked the seventh month in a row that retirements climbed among local-agency and district employees in CalPERS. Nearly 15,100 non-state workers took their pensions in the 10-month period, up 5 percent from a year earlier.
More state employees are sticking around due to across-the-board pay increases that took effect this year and others that come online in 2016. Many have not received raises in many years without promoting. The salary increases not only boost their monthly paychecks, but enhance their pension – if an employee works long enough at the higher pay rate, the increase is factored into his or her retirement pay.
The drop in state retirements also reflects several years of furloughs that pushed thousands of state employees to leave early rather than deal with pay cuts that reached up to 15 percent. The furlough program ran intermittently from February 2009 though June 2013.
Once those two factors wash through, expect state retirements to resume climbing. More than half of state workers are of retirement age.
This chart shows the latest CalPERS retirement data for state employees, non-state workers and all members in the system.