Policy Research

Teacher Retirement Benefits: Even in Economically Tough Times, Costs are Higher Than Ever

Robert Costrell, Michael Podgursky

Summary

The authors use data from the US Department of Labor to track the difference between employer contributions to teacher pensions versus those in the private sector. Teacher retirement benefits are costlier than private retirement packages in the private sector: about 14% of earnings for teachers and 10% for a selection of private sector professionals.

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Policy Implications

Teacher benefits are protected by law in most states, so even if a policy is passed to reduce the future benefits for new hires, there will not be a reduction in cost in the near future.