It's been an article of faith that public-sector employees have it better than their private-sector counterparts where retirement is concerned.
The data seem to support that overall premise. But making direct comparisons is difficult because of the variability in retirement plans.
Virtually all government workers have defined-benefit plans, in which they and their employers contribute toward a multibillion-dollar pool of assets that are invested. When they retire, the employees get a fixed amount of
money from that pool, based on their years of service and highest annual salaries.
In Ohio, the average state and local government retiree is paid $25,736 a year. That's 7 percent more than the $24,052 average pension for government retirees nationwide, according to the Congressional Research Service.
Private-sector pensions and annuities average $13,326, the research arm of Congress said. Slightly more than half of private-sector retirees supplement their pensions with income from Social Security, which averages $12,699
Those are national figures. The Congressional Research Service did not break down its data by state.
Government employers in Ohio do not pay into Social Security, as pensions supplant the role of Social Security income for government retirees older than 65 in the state. That saves school districts and other units of government the
6.2 percent of payroll that private employers pay into Social Security. Ohio is among eight states in which government retirees are fully exempt from Social Security taxes or benefits.
While nearly all government workers get defined-benefit pensions, private-sector employees are increasingly in 401(k) and other defined-contribution plans. They pay a fixed amount into the system, sometimes matched by their employers, but their retirement income depends on how well their assets perform in the marketplace.
Such plans are vulnerable to recessions, as many Americans have grimly discovered during the past couple of years.
Nationally, 86 percent of state and local government employees participate in a retirement plan, according to a July report by the U.S. Labor Department. Fifty-one percent of private-sector workers have a retirement plan, the agency reported.