Calpers has conducted two new research studies analyzing the effects of California's Public Employees' Pension Reform Act of 2013 on public employee compensation.
The Emerging Role of Defined Contribution Plans for California Public Employees study found that in general, new Calpers members need to save between $373 and $1,480 more each month or work 2.5 to 5 years longer to retire with the same income as Calpers members who were hired before the pension reform act went into effect.
The study showed that with careful retirement planning and the use of a Defined Contribution plan, which allows employees to supplement their pension, new members can achieve the same retirement results as members that were hired before January 1, 2013.
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The second study, California Public Employee Retirement Benefits – Assessing Compensation Changes, found a difference of $435 less per month in retirement income for new Calpers members compared to members hired before the pension reform was enacted.
The study also compared California's retirement benefits to those in the rest of the country, and estimated that California government employers spent 0.06 less on overall compensation compared to the national average in 2010 and 0.30 percent, slightly more than the national average, on retirement benefits.
Calpers said the overall compensation numbers will change as most new government employees will have reduced benefits under the pension reform law and some employees are required to contribute more to their defined benefit plan's normal cost.
Calpers administers health and retirement benefits on behalf of more than 3,000 State, public school and local agency employers. It has more than 1.6 million members in its retirement system and more than 1.3 million in its health plans.
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