Industry News

On June 25, 2024, the National Institute on Retirement Security (NIRS) released its report, The Role of Defined Benefit Pensions in Recruiting and Retaining Public Safety Professionals. The research examines the role of defined benefit pension plans as an important workforce management tool for public safety employers. In addition, the report also discusses various features of pension plans that are significant for public safety professionals, including Social Security coverage and the availability of a Deferred Retirement Option Plan (DROP).

Based on national datasets and a nationally representative sample of 28 police and fire pension plans, the key findings include:

• Of the current employees, 75% or more are expected to retire from their plan;
• More than half (52%) of new hires are expected to retire from their pension plan, which exceeds levels of employee retention in the private sector; and
• The average tenure for police officers is 18 years, 20 years for firefighters, and an average of 17.6 years for all public safety workers combined.

In the U.S., there are over one million full-time police officers and firefighters. Due to the physical demands and potential dangers inherent in their work, police officers and firefighters generally have shorter public service careers and retire earlier. Since they are in higher risk jobs, death and disability benefits are also very important.

Of the respondents, the majority reported that the ability to earn a pension benefit was a significant reason they chose a public sector job, and over 60% of police officers and firefighters indicated that being eligible for a pension was a major reason they stayed at their job. Almost all of the police officers and firefighters agreed that pensions are an essential tool to recruit (97% for police and 99% for fire) and retain (99% for both groups) public safety professionals.

The report concludes, “In addition to helping manage the transition into retirement at the end of a career, pension plans have critically important recruitment and retention effects for public safety personnel. While public safety departments across the country are struggling with employee recruitment and retention, especially in the years since the onset of the Covid-19 pandemic, those jurisdictions that recently have made significant changes to their public pension plans have experienced higher levels of employee turnover.”

Joe Newton, Pension Market Leader and member of the GRS Office of the Chief Actuary, was one of the report authors, among others. 

The report is available here.